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Investment A makes annual payments of $140 for each of the next 7 years, while investment B makes annual payments of $70 per year for
Investment A makes annual payments of $140 for each of the next 7 years, while investment B makes annual payments of $70 per year for 25 years. At what interest rate would you be indifferent between the two investments?
a) For a given interest rate, present value of an annuity cannot be equal to the present value of a perpetuity
b)0.4891
c)0.1184
d)0.0686
e)0.1041
f)0.0849
g) There is no interest rate for which one is indifferent between both investments
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