contestada

A generous benefactor to a local symphony plans to make a one-time endowment that would provide the ballet with $150,000 per year into perpetuity. The rate of interest is expected to be 6 percent for all future time periods. How large must the endowment be?

Respuesta :

Answer:

The right answer is "$2,500,000".

Explanation:

The given values are:

Interest rate,

= 6%

i.e.,

= 0.06

Perpetuity per year

= $150,000

Now,

The present value will be:

= [tex]\frac{Perpetuity}{Interest \ rate}[/tex]

On substituting the estimated values, we get

= [tex]\frac{ 150,000}{0.06}[/tex]

= [tex]2,5 00,00 0[/tex] ($)

Otras preguntas