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Jones purchased a perpetuity today for $7, 000. He will receive the first annual payment of $200 five years from now. The second annual payment
Jones purchased a perpetuity today for $7, 000. He will receive the first annual payment of $200 five years from now. The second annual payment will be $200 plus an amount C. Each subsequent payment will be the prior payment plus an additional constant amount C. If the effective annual interest rate is 4%, find C. I know the answer is 5.1 but I'm not sure how to get there.
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