growingperpetuity - Maple Help

Finance

 growingperpetuity
 present value of a growing perpetuity

 Calling Sequence growingperpetuity(cash, rate, growth)

Parameters

 cash - amount the perpetuity will pay one period from now rate - interest rate nperiods - growth rate in the payments

Description

 • The function growingperpetuity computes the present value of a perpetuity paying the amount cash one period from now, with increasing payments at the end of each periods. The payments increase according to the growth rate.
 • Since growingperpetuity used to be part of the (now deprecated) finance package, for compatibility with older worksheets, this command can also be called using finance[growingperpetuity]. However, it is recommended that you use the superseding package name, Finance, instead: Finance[growingperpetuity].

Examples

I hold some shares of the XYZ company. I will receive dividends each year. The next dividend is expected to be 1.5 units per share, one year from now. The yearly dividends are expected to increase by 2% per year, for the foreseeable future What is the present value, per share, of the dividend payments, given that the discount rate is 11%?

 > $\mathrm{with}\left(\mathrm{Finance}\right):$
 > $\mathrm{growingperpetuity}\left(1.5,0.11,0.02\right)$
 ${16.66666667}$ (1)

Compatibility

 • The Finance[growingperpetuity] command was introduced in Maple 15.