Question: (a) You belong to an unusual pension plan because your retirement payments will continue forever (and will go to your descendants after you die). If you will receive $36,000 per year at the end of each year starting 20 years from now (i.e., the first payment is in time 20), what is the present value of your retirement plan if the discount rate is 4.5%?
(b) How does your answer change if you receive $3,000 per month every month forever (in perpetuity) starting 20 years from today (in monthly time period 240) and you compound monthly?
i just need help figuring out what formulas to use Edit
Answer: a) the present value of the retirement plan is $331,714.29
b)when we receive 3,000 per month forever then the present value is $325, 803.69
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