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Net Present Value (a) Suppose that the annual interest rate is 10%. What is the value of a perpetuity that pays $30 every year from

Net Present Value

(a) Suppose that the annual interest rate is 10%. What is the value of a perpetuity that pays $30 every year from the beginning of next year?

(b) Suppose that the annual interest rate is 5%. What is the value of a perpetuity that pays $100 every other year from the beginning of next year?

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