If the present value of a perpetual income stream is increasing, ...

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If the present value of a perpetual income stream is increasing, the discount rate must be:
 
  A) Increasing
  B) Decreasing
  C) Changing unpredictably
  D) Keeping pace with inflation

Question 2

Use the percent of sales method of preparing pro forma financial statements to determine the
  projection for next year's accounts payable.
 
  Make the following assumptions: current year's sales
  are 27,800,000; current year's cost of goods sold is 17,528,000; sales are expected to rise by 30.
  The firm's investment in accounts payable in the current year is 2,218,500. What is the projection
  for next year's accounts payable?
  A) 3,781,750 B) 2,884,050 C) 4,184,000 D) 2,127,000

[Bison]

Answer to Question 1

A

Answer to Question 2

B