Questions

What is the present value of $$1,000$ paid at the end of each of

the next $100$ years if the interest rate is $7\%$ per year? Make sure

to include a timeline.

You are head of the Schwartz Family Endowment for the

Arts. You have decided to fund an arts school in Toronto in

perpetuity. Every five years, you will give the school $$1$ million.

The first payment will occur five years from today. If the interest

rate is $8\%$ per year, what is the present value of your gift? Make

sure to include a timeline.Perpetuities and Annuities

Questions:

$1)$ What is the present value of $$1,000$ paid at the end of each of the next $100$ years if the interest rate is $7\%$ per year? Make sure to include a timeline.

$2)$ You are head of the Schwartz Family Endowment for the Arts. You have decided to fund an arts school in Toronto in perpetuity. Every five years, you will give the school $$1$ million. The first payment will occur five years from today. If the interest rate is $8\%$ per year, what is the present value of your gift? Make sure to include a timeline.