Determine the value of perpetuity


On January 1, 1988, Felix inherited the perpetuity with annual payments beginning in six months. The first payment was $3,000, and after that payments raised by 3% each and every year. Determine the value of this perpetuity on January 1, 1995 if the annual effective interest rate was 6% from January 1, 1988 through January 1, 1996 and 4% thereafter.

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Basic Statistics: Determine the value of perpetuity
Reference No:- TGS0873904

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