Explore BrainMass

Explore BrainMass

    Present Value of a Growing Perpetuity

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    I am evaluating a growing perpetuity product from a large financial services firm. The product promises an initial payment of $24,000 at the end of this year and subsequent payments that will thereafter grow at a rate of 0.02% annually. If you use a discount rate of 0.07% for investment products, what is the present value of this growing perpetuity?

    © BrainMass Inc. brainmass.com June 2, 2020, 1:00 am ad1c9bdddf

    Solution Preview

    Present value of this growing perpetuity:

    = Payment for the ...

    Solution Summary

    This solution explains the present value of a specific growing perpetuity.