Taka holds three different investments: the first will provide £150 per year forever; the second will provide £1,000 per
Posted: Mon Nov 15, 2021 5:05 pm
Taka holds three different investments: the first will provide
£150 per year forever; the second will provide £1,000 per year for
the next 7 years (in each case, payments commencing one year from
now and continuing annually); and the third will provide £30,000 in
five years’ time. If the constant annual discount rate appropriate
to all the payments is 6% per annum, the total present value of the
three investments is approximately:
a. £14,100 b. £30,500 c. £21,800 d. £27,300
£150 per year forever; the second will provide £1,000 per year for
the next 7 years (in each case, payments commencing one year from
now and continuing annually); and the third will provide £30,000 in
five years’ time. If the constant annual discount rate appropriate
to all the payments is 6% per annum, the total present value of the
three investments is approximately:
a. £14,100 b. £30,500 c. £21,800 d. £27,300