If a perpetuity is currently priced at $1,500 and you expect to earn a 4.5% return,...

If a perpetuity is currently priced at $1,500 and you expect to earn a 4.5% return, what is the annual payment you expect to receive?

	a.	$57.50
	b.	$67.50
	c.	$37.50
	d.	$45.00

Solutions

Expert Solution

Annual payment = Amount * Return

Annual payment = $1,500 * 0.045

Annual payment = $67.50

jeff jeffy answered 1 year ago

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