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1. Juan has been saving for several years in an investment fund that pays interest at 4% per month. Juan's idea is to retire from
1. Juan has been saving for several years in an investment fund that pays interest at 4% per month. Juan's idea is to retire from work and live on his savings forever, receiving a monthly income of $1,000. How much money does Juan need to have saved to meet that goal?
2. The Lasik company is working on a very advanced technology for laser eye surgery that will be available in the near future. He anticipates his first annual cash flow from technology to be $215,000, which he will receive two years from today. Subsequent annual cash flows will grow at a rate of 4% in perpetuity. What is the present value of the technology if the discount rate is 10%?
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