Perpetwities are also calied annuities with an extended or unlimited We. Based on your understanding of perpetultins, answer the follewing questions. Which of the following are characteriatics of a perpetuity? Check ail that apply. The current value of a perpetuity is based more on the discounted value of its nearer (in time) cash flows and fess by the biscounted value of its more distant (in the future) cash flows. The value of a perpetuity cannot be determined. The value of a perpetuity is equal to the sum of the present value of its expected future cash fows. A perpetuity is a stream of unequal cash flows. Your grandfather wants to estabish a scholarship in his father's name at a local univeruty and has stipulated that you will administer it. As you've commixted to fund a $5,000 scholarship every year beginning one year from tomorrow, you'l want to set aside the money for the scholarship Immediately. At tomorrow's meeting with your grandfather and the bank's representative, you will need to deposit (rounded to the nearest whole dollar) so that you can fund the scholarship forever; assuming that the account will earn 4.50% per annum every year. Oops! The bank representative just reported that he misquoted the available interest rate on the scholarship's account. Your account should earn 7.00\%. The amount of your required deposit should be revised to This suggests there is relationship between the interest rate earned on the account and the present value of the perpetuity