A perpetuity is a specific type of annuity where a stream of equal, regular payments continues indefinitely—forever. While true perpetuities are rare in practice, this concept is a vital theoretical tool in finance, particularly for valuing certain types of assets like preferred stocks with fixed dividends or endowed scholarships that are intended to pay out indefinitely. The Perpetuity Calculator is used to determine the Present Value (PV) of such an infinite stream of cash flows. The calculation for the present value of a perpetuity is elegantly simple, and this tool makes it even easier. You only need to provide two inputs. First, enter the 'Periodic Payment (D)', which is the fixed amount of money that will be received in each period (e.g., the annual dividend). Second, you need to input the 'Discount Rate (r)' as a percentage. The discount rate is the rate of return used to discount the future cash flows back to their present value. It typically reflects the risk of the investment and the opportunity cost of capital. Once you've entered both values, click the 'Calculate Present Value' button. The tool will apply the straightforward formula PV = D / r to find the total present value of the perpetual payments. This value represents the single lump sum that, if invested at the discount rate, could generate the specified periodic payments forever without depleting the principal.