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A prominent alumnus of your university has just donated $3,300,000 to fund a scholarship that will distribute $119,000 per year forever beginning in one year.

A prominent alumnus of your university has just donated $3,300,000 to fund a scholarship that will distribute $119,000 per year forever beginning in one year. For this to be true, what rate of return is expected on the donation?

  • 3.73%

  • 3.61%

  • 3.85%

  • 3.47%

  • 3.79%

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