Dr Pollard donated $100,000 to the Canadian National Institute for the Blind The money is to be used to make semiannual payments in perpetuity (after a period of deferral) to finance the recording of books on CD for the blind The first perpetuity payment is to be made five years from the date of th...

The payments form a deferred perpetuity having a 45year period of deferral At a fo ...

Dr. Pollard donated $100,000 to the Canadian National Institute for the Blind. The money is to be

Question:

Dr. Pollard donated $100,000 to the Canadian National Institute for the Blind. The money is to be used to make semiannual payments in (after a period of deferral) to finance the recording of books-on-CD for the blind. The first payment is to be made five years from the date of the donation. If the funds are invested at 5% compounded semiannually, what will be the size of the payments?
Perpetuity
Perpetuity refers to payments that are made without an end or maturity date. A perpetuity is classified as an annuity, which is something that earns a dividend or receives a payment at a regularly scheduled interval, generally yearly. So, how...