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The Perpetual Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $15,000 per year forever. a.

The Perpetual Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $15,000 per year forever.

a. If the required return on this investment is 3.8 percent , how much will you pay for the policy? (Round your answer to 2 decimal places, e.g. , 32.16) b. Suppose the Perpetual Life Insurance Co. told you the policy costs $325,000 . At what discount rate would this be a fair deal? (Round to two decimals)

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