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A perpetuity makes quarterly payments, with the first payment being $1,000, and subsequent payment being $250 greater than the previous payment. The effective annual interest
A perpetuity makes quarterly payments, with the first payment being $1,000, and subsequent payment being $250 greater than the previous payment. The effective annual interest rate is 10%. Find the present value of this perpetuity one year before the first payment.
Please demonstrate with this formula:
(P/i) + (Q/i^2)
where P = first deposit, Q = amount added each period, i = interest
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