A perpetuity is a financial asset that pays at an agreed rate forever, with present value calculated using a formula involving payment and discount rate. It is a mathematical concept that reflects uncertainty, and genuine perpetuities include British war bonds. The present value of a perpetuity is calculated by dividing the payment by a discount […]

A perpetuity is a financial asset that pays a fixed amount forever, and its present value can be calculated using a formula with a discount rate. It is a mathematical concept, and not a realistic view, but some genuine perpetuities exist. Calculating the present value of an annuity involves taking into account factors such as […]