CUET Preparation Today
At what rate will the present value of a perpetuity of Rs.1000 payable at the end of each quarter be Rs.50000? |
5% p.a 8% p.a 2% p.a 4% p.a |
8% p.a |
The correct answer is Option (2) → 8% p.a $PV = \frac{C}{r}$ $PV = 50000 ,\ C = 1000$ $50000 = \frac{1000}{r}$ $r = \frac{1000}{50000} = 0.02$ $r = 2\% \text{ per quarter}$ Annual Rate = $4 \times 2\% = 8\%$ |
