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An investment offers to pay $120 4 points a year forever starting at the end of year 6. If the interest rate is 6%, what
An investment offers to pay $120 4 points a year forever starting at the end of year 6. If the interest rate is 6%, what is the investment's value today? (hint: draw a clear timeline) O A. $1,586.87 O B. $850.73 O C. $1,494.52 O D. $1,409.92 How much more is a perpetuity 4 points of $1,000 worth than an annuity of the same amount for 25 years? Assume an interest rate of 10% and cash flows at the end of each period. O A. $922.96 O B. $1,486.44 O C. $2,200.00 O D. $1,297.29
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