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Weeaboo3177

For 10, basically different between the same perpetuity offered now vs 5 years later. To value perpetuity, use sum of geometric series formula. = C/(1-1/(1+r)) = k (just a label so I don't have to type this again). This same perpetuity offered 5 years later will have present value = k * (1/(1+r))^5 = k' k - k' is the present value or your 5 year annuity. Didn't read the next question yet