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3 Annuity, But You Have to Wait Consider an annuity with a yearly payment of $75,000 that makes its first payment at the end of
3 Annuity, But You Have to Wait Consider an annuity with a yearly payment of $75,000 that makes its first payment at the end of year 5, and consists of 10 payments. Assume that the appropriate interest rate is 11% per year. 3.1. Using formulas for annuities, value this annuity (compute its present value) as of the end of year 4 (i.e. as if time had passed, and now were at the end of year 4); name this value PV4. 3.2. Using formulas for annuities, value this annuity as of the end of year 5; name this value PV5. What kind of annuity is this when viewed from the end of year 5? 3.3. Compute the present value of this annuity at time 0 in two different ways, starting separately from PV4 and PV5, respectively. Compare and comment very briefly on the two answers that you get
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