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An annuity is payable annually in advance for a term of 2 0 years. The payment is 5 0 0 in year 1 , Exam

An annuity is payable annually in advance for a term of 20 years. The payment is 500 in year 1, Exam style
550 in year 2, and so on, increasing by 50 each year.
Calculate the present value of this annuity, assuming that the effective rate of interest is 5% pa
for the first twelve years and 7% pa thereafter.

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