Question 6
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.
Another trust of ₹3,60,000, also earning 6%, pays a prize every year for ever. How large is the prize?
Show the answer and explanation
CorrectNot quiteAnswer B
Correct answer: B
Explanation
A perpetuity pays the interest and keeps the fund whole.
rupees a year.
Worth noting
₹60,00,000 divides by 0.06 when the fund is already known.
- Concept
- The payment a fund supports
- Typical timeTypical
- 90 s
- Your timeYours
- —
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