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The present value of a perpetuity of Rs. 2,500 payable at the end of each year, if money is worth 10% compounded annually, is :

Solution

✅ Correct Option: 1

Present value of perpetuity (paid at end of year) =Rr=25000.10=25000= \frac{R}{r} = \frac{2500}{0.10} = 25000.

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