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9. Perpetuities Perpetuities are also called annuities with an extended, or unlimited, life. Based on your understanding of perpetuities, answer the following questions: Which of
9. Perpetuities Perpetuities are also called annuities with an extended, or unlimited, life. Based on your understanding of perpetuities, answer the following questions: Which of the following are characteristics of a perpetuity? Check all that apply. The value of a perpetuity is equal to the sum of the present value of its expected future cash flows. The current value of a perpetuity is based more on the discounted value of its nearer (in time) cash flows and less by the discounted value of its more distant in the future) cash flows. The value of a perpetuity cannot be determined. A perpetuity is a stream of unequal cash flows. A local bank's advertising reads: "Give us $15,000 today, and we'll pay you $5,200 every year forever. If you plan to live forever, what annual interest rate will you earn on your deposit? 34.67% 55.47% 48.54% 41.60% Oops! When you went in to make your deposit, the bank representative said the amount of required deposit reported in the advertisement was incorrect and should have read $22,500. This revision will the interest rate earned on your deposited funds. The change to your required deposit will cause your earned interest rate to change to
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