At what rate of interest will the present value of a perpetuity of $\text{ ₹500 }$ payable at the end of each quarter be $\text{ ₹40000 }$?

Given, $\mathrm{R}=₹500,\mathrm{P}=₹40000$

So, $i=\frac{\mathrm{R}}{\mathrm{P}}=\frac{500}{40000}=0.0125$

$\begin{array}{l}\Rightarrow \frac{r}{100}=0.0125\text{ per quarter }\\ \Rightarrow r=1.25\mathrm{\%}\text{ per quarter }\\ \Rightarrow r=4\times 1.25\mathrm{\%}\text{ p.a. }\Rightarrow r=5\mathrm{\%}\text{ p.a. }\end{array}$

$\therefore$ Option (c) is the correct answer.