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Strapped for cash, your neighbor makes you the following offer. He will pay you back the money he borrows today over the next 11 years.

Strapped for cash, your neighbor makes you the following offer. He will pay you back the money he borrows today over the next 11 years. He will make yearly payments with the first payment being for $1,000 at the end of this year. The payments will grow by 11% every year thereafter. If the appropriate discount rate is 20%, how much would you be willing to lend your neighbor today?

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