3 ms·

Thanks for the explanation, I saw the formula in the OP for pricing it and it seemed like using that simple formula, the price should be infinity. I came to ask

Thanks for the explanation, I saw the formula in the OP for pricing it and it seemed like using that simple formula, the price should be infinity. I came to ask about that and your comment answered the would-be question. Thanks!

JumpCrisscross 5y ago
> seemed like using that simple formula, the price should be infinity Deriving the value of a perpetuity is simple but revealing [1]. [1] http://fahmi.ba.free.fr/docs/Courses/2012%20HEC/FBA_FE_Chap1_time_value_derivation.pdf http://fahmi.ba.free.fr/docs/Courses/2012%20HEC/FBA_FE_Chap1...