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QUESTION
The answer is C but how can I get that?
A perpetuity will pay you an initial cash flow of $8.58 today. You will then receive semi-annual payments that grow at 2.5% APR. What is the value of the perpetuity if the discount rate is 6.1% APR?
(a) $252.87 (b) $298.47 (c) $491.20 (d) $238.33 (e) $703.56
