What is the prevailing interest rate

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Reference no: EM131234147

1. What is the PV of a perpetuity paying $30 each month, beginning next month, if the annual interest rate is a constant effective 12.68% per year?

2. What is the prevailing interest rate if a perpetual bond were to pay $100,000 per year beginning next year and costs $1,000,000 today?

Reference no: EM131234147

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