Problem 3.4 A perpetuity makes payments at the end of each year at an annual effective rate of 3.4%. The payment pattern is 3.2.1 (at the end of years 1, 2 and 3) and this pattern repeats (i.e. payments of 3,2,1 at the end of years 4,5,6 and so on). Calculate the present value of the perpetuity