(2 pts) You want to set up an endowed scholarship that will pay $5000 a year...

Question

Question

Answer 1

Answer #1

Dear student, only one question is allowed at a time. I am answering the first question

4)

Amount to be donated today is the value of perpetuity

Value of perpetuity

= A / r

Where,

A = Periodic payments to be received

r = Rate of interest

So, Value of perpetuity

= $5,000 / 4%

= $125,000

Answer 2

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