Revision as of 08:44, 18 November 2023 by Admin (Created page with "'''Solution: A''' The value of the perpetuity after the fifth payment is 100/0.08 = 1250. The equation to solve is <math display = "block"> \begin{array}{c}{{1250=X( v+1.08 v^{2}+\cdots+1.08^{24} v^{25})}}\\ {{=X( v+ v+\cdots+ v)=X(25)/1.08}}\\ {{X=50(1.08)=54.}}\end{array} </math> {{soacopyright | 2023 }}")
Exercise
ABy Admin
Nov 18'23
Answer
Solution: A
The value of the perpetuity after the fifth payment is 100/0.08 = 1250. The equation to solve is
[[math]]
\begin{array}{c}{{1250=X( v+1.08 v^{2}+\cdots+1.08^{24} v^{25})}}\\ {{=X( v+ v+\cdots+ v)=X(25)/1.08}}\\ {{X=50(1.08)=54.}}\end{array}
[[/math]]
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