Perpetuity
A perpetuity is a financial instrument or stream of cash flows that pays a fixed amount of money indefinitely. The payments are typically made at a regular interval of times per year, and the amount of each payment remains constant over time. Formally, the present value of a perpetuity, given an annual percentage rate , is expressed as
Additionally, a growth perpetuity is a perpetuity that grows at a constant annual rate of given a principal :
No Initial Payment . The formula for a perpetuity-due is given as
The standard perpetuity formula assumes that there is no payment at