The present value of a perpetuity of Rs. 900 payable at the end of each year, if money is worth 6% per annum, is:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Rs.15,000
The present value of a perpetuity paid at the end of each period is
\( \displaystyle P=\frac{R}{i}=\frac{900}{0.06}=15{,}000 \)
So the present value is Rs. 15,000.
CBSE Applied Mathematics (Class XII):
Perpetuity
