Multiple Choice
Jason buys a consol (perpetual bond) that pays out a fixed cash flow of $750,000 every year,forever,starting at the end of this year.If the current market rate is 12.5%,what is the present value of the cash flows?
A) $6,000,000
B) $750,000
C) $843,750
D) $600,000
E) $7,500,000
Correct Answer:
Verified
Correct Answer:
Verified
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