CUET · MATHS · PYQ PAPER 2025
At what rate of interest will the present value of a perpetuity of ₹ 500 payable at the end of every 6 months be ₹ 20,000 ?
- A \(10\%\) per annum
- B \(20\%\) per annum
- C \(5\%\) per annum
- D \(7\%\) per annum
Answer & Solution
Correct Answer
(C) \(5\%\) per annum
Step-by-step Solution
Detailed explanation
\( PV = \frac{A}{i} \) \( 20,000 = \frac{500}{i} \) \( i = \frac{500}{20,000} = 0.025 \) (semi-annual rate) Annual rate \( = 0.025 \times 2 = 0.05 = 5\% \)
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