A perpetuity has a PV of $25,000. If the interest rate is 7%, how much will the perpetuity pay every year? A. $1,050 B. $1,400 C. $1,750 D. $875 Click to select your answer.
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In this case, we are given that the present value is $25,000 and the interest rate is 7%. We need to find the annual payment, which is C. Using the formula, we can rearrange it to solve for C: C = PV * r Plugging in the given values, we have: C = $25,000 * Show more…
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