Question 5
EasyOriginal questionA family sets up a trust to pay a scholarship of ₹15,000 at the end of every year, for ever. Money earns 6% a year.
How much must the family put into the scholarship trust today?
Show the answer and explanation
CorrectNot quiteAnswer D
Correct answer: D
Explanation
Present value of a perpetuity .
rupees.
Worth noting
₹90,000 multiplies by 6 instead of dividing by 0.06.
- Concept
- Present value of a perpetuity
- Typical timeTypical
- 90 s
- Your timeYours
- —
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