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A perpetuity-immediate pays 100 per year. Immediately after the fifth payment, the perpetuity is exchanged for a 25-year annuity- immediate that will pay at the
A perpetuity-immediate pays 100 per year. Immediately after the fifth payment, the perpetuity is exchanged for a 25-year annuity- immediate that will pay at the end of the first year. Each subsequent annual payment will be 7% greater than the preceding payment. The annual effective rate of interest is 8%. Calculate X.
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