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You will receive a $100 annual perpetutity, the first payment to be received now, at Year 0, a $300 annual perpetuity payable starting at the
You will receive a $100 annual perpetutity, the first payment to be received now, at Year 0, a $300 annual perpetuity payable starting at the end of Year 5, and a $200 semiannual (2 payments per year) perpetuity payable starting midway through year 10. If you require an effective annual interest rate of 14.49%, what is the present value of all three perpetuities together at year 0? (Hint: The semiannual annuity can be though of as two annual annuities.)
Please show work and give formulas.
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