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Luke is paid a 5-year annuity immediate of (t = 1, 2, 3, 4, 5) $1,000 per year, which accumulates at an annual interest rate
Luke is paid a 5-year annuity immediate of (t = 1, 2, 3, 4, 5) $1,000 per year, which
accumulates at an annual interest rate of 5%. While the last payment ends at t = 5,
the money continues to accumulate at an annual 5% interest rate. Leia is paid a 7-year
annuity immediate of 800 per year, which accumulates at an annual interest rate of
7%. Her money likewise continues to accumulate at an annual 7%. At time t = 10,
whose money is worth more?
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