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Due to a legal settlement, you expect to receive checks of $50,000, $75,000 and $100,000 in 3 years, 4 years and 5 years, respectively. Your
Due to a legal settlement, you expect to receive checks of $50,000, $75,000 and $100,000 in 3 years, 4 years and 5 years, respectively. Your broker at Charles Schwab has agreed to lend you money today to invest in the stock market using the checks as collateral. Charles Schwab requires a 2% annual return, compounded annually, on loans to customers.
What is the largest investment you can make with the loan?
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