CUET Preparation Today
The present value of a perpetuity of ₹500 payable at the end of the every 6 months is ₹10,000, then rate of onterest will be : |
10% $\frac{1}{10}$% 5% 20% |
10% |
The correct answer is Option (1) → 10% The Present value of a perpetuity is, $PV=\frac{C}{r}$ $⇒10,000=\frac{500}{r}$ $⇒r=0.05$ (per 6 months) ∴ Annual interest Rate = $0.05×2=10\%$ |
