Question
Which one of the following statements is true concerning the duration of a perpetuity? A.The duration of 15% yield perpetuity that pays $100 annually is
Which one of the following statements is true concerning the duration of a perpetuity?
A.The duration of 15% yield perpetuity that pays $100 annually is longer than that of a 15% yield perpetuity that pays $200 annually.
B.The duration of a 15% yield perpetuity that pays $100 annually is shorter than that of a 15% yield perpetuity that pays $200 annually.
C.The duration of a 15% yield perpetuity that pays $100 annually is equal to that of 15% yield perpetuity that pays $200 annually.
D.The duration of a perpetuity cannot be calculated.
Give explanation for it.
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Entrepreneurial Finance
Authors: J. Chris Leach, Ronald W. Melicher
6th edition
1305968352, 978-1337635653, 978-1305968356
