What percentage more money is required to fund an ordinary perpetuity than to fund a 30-year ordinary annuity if the funds can earn 5.8% compounded semi-annually? The perpetuity and the annuity each pay $1,000 semi-annually.

Compounded Semi-annually

Describes a type of interest calculation where the interest is added to the principal amount twice a year, leading to interest on the interest in the next compounding period.

Ordinary Perpetuity

A series of indefinite cash flows that occur at regular intervals.

Ordinary Annuity

A financial product where payments of a fixed amount are received at the end of equal intervals.