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Chapter 02, Bucket 1 Problem 10. Find the present value of an annuity stream in which the first payment of $111 is received 6 yedrs
Chapter 02, Bucket 1 Problem 10. Find the present value of an annuity stream in which the first payment of $111 is received 6 yedrs from today, and thereafter 9 additional payments are paid to you each year. The size of the annuity payments will be the same size each year and therefore, the value of g will be zero). Use an annual discount rate of 7.5%. Due to the delay in the first payment, this is a 'tricky problem. So, make sure that you draw an especially good timeline! Clearly label the growth rate on the cash flow timeline (to be zero), and show that the cash flow arrows that comprise the annuity stream are equal in size. Question 11 1 pts tv RA IV W go F3 000 000 F4 F7 99 F10 # $ % 1 & *
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