The interest rate is 10%. What is the PV of an asset that pays $1 a year in perpetuity?
A: $20
B: $30
C: $10
D: $40
A: $20
B: $30
C: $10
D: $40
举一反三
- A perpetuity that pays $250 per year at an interest rate of 4% would have a market price equal to A: $6,250. B: $25,000. C: $2,500. D: $62,500.
- With an interest rate of 10 percent, the present value of a security that pays $1,100 next year and $1,460 four years from now is approximately _________
- The duration of a ten - year, 10 percent coupon bond when the interest rate is 10 percent is 6.76 years. What happens to the price of the bond if the interest rate falls to 8 percent?
- If the nominal interest rate per year is 10 percent and the inflation rate is 4 percent, what is the real rate of interest? A: 10.0 percent B: 4.1 percent C: 5.8 percent D: 14.0 percent
- If a one-year bond pays a fixed interest rate of 2.5% per year and this year's inflation rate is 2.8%, what is your real rate of return? A: 0.053 B: 0.028 C: 0.025 D: 0.003 E: -0.003