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Payments of 500, 600, and 900 are made at the ends of years 3, 7, and 10, respectively. Assuming an annual effective interest rate of
Payments of 500, 600, and 900 are made at the ends of years 3, 7, and 10, respectively. Assuming an annual effective interest rate of 6%, this sequence of payments is equivalent to a single payment of 2000 at time T. Let S be the approximation of T obtained using the method of equated time. Find S - T.
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