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What would happen to the present value of the perpetuity

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Problem 1: What is the present value of a perpetuity of $400 per year if the appropriate discount rate is 5%? Do not round intermediate calculations. Round your answer to the nearest cent.

Problem 2: If interest rates in general were to double and the appropriate discount rate rose to 10%, what would happen to the present value of the perpetuity?

Reference no: EM132772543

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