rorPerpetuity {tvmComp}

Computing Rate of Return of a Perpetuity.

Description

Computing Rate of Return of a Perpetuity.

Usage

rorPerpetuity(yearendCF, deposit)

Arguments

yearendCF

A number.

deposit

A number.

Details

As defined by Hummelbrunner,S.A. et al. (2020), a Perpetuity is an annuity in which the periodic payments begin on a fixed date and continue indefinitely. Interest payments on permanently invested sums of money are prime examples of Perpetuity. Dividends on preferred shares fall into this category if the issuing corporation has an indefinite life. Scholarships and trust funds paid perpetually from an endowment also fit the definition of Perpetuity. The method rorPerpetuity() is developed to compute Rate of Return(r) of a Perpetuity and gives r when values are passed to its two arguments. Here yearendCF is Cash Flow occurring at the Year-End and deposit stands for amount of the Deposit

Value

Input values to two arguments yearendCF and deposit

Author(s)

MaheshP Kumar, [e-mail]

References

Hummelbrunner,S.A., Halliday,K., Hassanlou,A.R. (2020). Contemporary Business Mathematics with Canadian Applications (12th Edition). Pearson Education Canada. ISBN 9780135285015, https://bookshelf.vitalsource.com/books/9780135406380.

Examples

rorPerpetuity(15, 180)
rorPerpetuity(10, 120)