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If the interest rate is 5%, which of these investments would you prefer? A payment of $51 a year for 20 years starting at the

If the interest rate is 5%, which of these investments would you prefer?

  • A payment of $51 a year for 20 years starting at the end of 1st year.

  • A payment of $614 today.

  • A single payment of $607 at the end of 1st year.

  • An ordinary perpetuity of $29.

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