Examveda
Examveda

Payment if it is divided with interest rate will be formula of

A. future value of perpetuity

B. present value of perpetuity

C. due perpetuity

D. deferred perpetuity

Answer: Option B

Solution(By Examveda Team)

Payment if it is divided with interest rate will be formula of present value of perpetuity. A perpetuity is a type of annuity that receives an infinite amount of periodic payments. An annuity is a financial instrument that pays consistent periodic payments. As with any annuity, the perpetuity value formula sums the present value of future cash flows.

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