What is the present value of a perpetuity of ₹6,000 a year, at 8% a year?

Explanation

1. 01

   A perpetuity pays for ever; its present value is $\frac{R}{i}$, the sum that earns $R$ a year in interest.

2. 02

   $\frac{6{,}000}{0.08} = 75{,}000$ rupees.