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# Perpetuity Calculator

If you want to determine the perpetuity's current/present value, you can use our Perpetuity calculator.

The flow of cash that continues forever is known as perpetuity. It's a variant of annuity that lasts for an infinite amount of time. In finance, Perpetuity calculation is used to evaluate the cash flow's current state of a company when redeeming it back at a special price.

Types of Perpetuity Stream

There can be three types of perpetuity streams. Let's have a look at these streams a bit:

1. Regular: After a certain period, the payment will be given to a company, e.g., monthly, or yearly.

2. Fixed: in this scenario, a fixed amount of money will be paid every time.

3. Indefinitely: It's an infinite loop of payment, and it stays continuous without an end.

## Formula of Perpetuity Calculator

To instantly find the present value of perpetuities, you can use our calculator, or to find it manually, you can use the formula listed below:

PV = D / R

Where,

PV = present value of perpetuity.

D = dividend

R = discount rate

Note:

To know about capital gain yield, you can use our Capital Gain Yield Calculator.

### Example

To better understand the perpetuities concepts, let us have an example below:

Suppose a boy invested in a bond returns a dividend of $10 yearly. Now, let's say the discount rate is 5%; find the worth/present value of this perpetuity. Given data Dividend =$10
Discount rate = 5%

To Find

PV = present value of perpetuity = ?

Solution

By using the PV of perpetuity formula, we will find the values:

PV = D / R

Putting values in the formula:

PV = $10 / 5% PV =$200

### How to use the Perpetuity Calculator?

The steps to use the perpetuity calculator are as follows:

Step 1: Enter the dividend value in the first required input.

Step 2: Enter the discount rate value in the second required input.

Step 3: The calculator will automatically display an answer on the screen.

### Calculator use

To find the perpetuity value, you can use our perpetuity calculator. Just enter the required values, and the answer will be shown on the screen.