What is the present value of this perpetuity

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Assume that you can invest money in a savings account with an APR of 8.0% and semi-annual compounding.

(a) What is the present value of an annuity that will pay $500 every six months for the next ten years and that makes its first payment today?

(b) You just won a perpetuity that will pay you $500 every six months. However, for bizarre legal reasons, the payments don't begin for 30 months. What is the present value of this perpetuity?

(c) What is the present value of a perpetuity that pays $500 every 18 months and that makes its first payment in 18 months?

Reference no: EM131969440

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