Multiple Choice
Having acquired great fortune based on your mastery of finance,you decide to set up a charity.You'd like to give the finance department of your alma mater $100,000 next year,and you want to make an annual contribution in perpetuity,with each year's contribution growing by 4%.The university can generate an 8% return on invested capital.What is the value of a lump-sum donation needed today to accomplish this?
A) $3,561
B) $833,333
C) $1,250,000
D) $2,500,000
Correct Answer:
Verified
Correct Answer:
Verified
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