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Assume an individual has an opportunity to receive an annuity that pays $ 5 0 , 0 0 0 per year for the next 2

Assume an individual has an opportunity to receive an annuity that pays $

50, 000

per year for

the next

25

years, with discount rate of

6 %

or a lump sum payment of $

650, 000,

and needs to

determine the more rational option. Using the above formula, the present value of this annuity

is:

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