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Hopkins Insurance Co. is selling a perpetuity contract that pays $1,200 monthly. The contract currently sells for $100,000. 1) What is the monthly return on

Hopkins Insurance Co. is selling a perpetuity contract that pays $1,200 monthly. The contract currently sells for $100,000.

1) What is the monthly return on this investment vehicle?

2) If instead, the amount of the monthly interest grows at a 0.1% rate every month, how much should Hopkins Life Insurance Co. price this contract to offer the same monthly return rate?

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