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The Difference in Present Value Between a Perpetuity That Promised

Question 11

Multiple Choice

The difference in present value between a perpetuity that promised $1 per year starting today and one that promised $1 per year starting next year is


A) 0.
B) $1.
C) $1/(1 + r) .
D) $r/(1 + r) .

Correct Answer:

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