Which of the following is true about perpetuitiesa since a, Ask an Expert

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Which of the following is true about perpetuities?

a. Since a perpetuity generates cash flows every period infinitely, the cash flow generated equals the PV times the interest rate.

b. Since a perpetuity generates cash flows every period infinitely, initial cash outflow must be discounted to calculate the present value.

c. Since a perpetuity generates cash flows every period infinitely, there is no way to solve for the cash flow using the present value and the interest rate.

d. Since a perpetuity generates cash flows every period infinitely, its future value is as same as its present value.

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Financial Management, Finance

Category:- Financial Management
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