Question
British government 3.2% perpetuities pay 3.2 interest at the end of each year forever. Another bond, 1.7% perpetuities, pays 1.70 a year forever. a. What
| British government 3.2% perpetuities pay 3.2 interest at the end of each year forever. Another bond, 1.7% perpetuities, pays 1.70 a year forever. |
| a. | What is the value of 3.2% perpetuities if the long-term interest rate is 5.2%? (Round your answer to 2 decimal places.) |
| Perpetuity value |
| b. | What is the value of 1.70% perpetuities? (Round your answer to 2 decimal places.) |
| Perpetuity value |
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The Preppers Financial Guide
Authors: Jim Cobb
1st Edition
1612434037, 978-1612434032
