• 7. Annuities

    The last step of the module is to value investment proposals with recurring cash flow streams that last for a specific period of time. An example of such a project could be a pension plan that makes an annual payment over, say, 25 years after retirement. The section develops very useful shortcuts to value such annuities and it provides a broad set of examples to practice this valuation approach in real-life situations.

6. Perpetuities