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What is the value of a British consol that pays £50 per year forever if the...

What is the value of a British consol that pays £50 per year forever if the relevant interest rate is 5 percent? The next payment is in one year.  (Do not round intermediate calculations and round your final answer to the nearest £.)

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Answer #1
PV of perpetual CF = Perpetual CF/(interest rate-growth rate)
PV of perpetual CF = 50/(0.05-0)
PV of perpetual CF = 1000
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