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Three children inherit an estate with a current value of $400,000. The first child will receive an amount which, when invested, will provide $10,000 per
Three children inherit an estate with a current value of $400,000. The first child will receive an amount which, when invested, will provide $10,000 per year while leaving his share of the principal intact. The second child will receive payments of $20,000 at the end of each of the next ten years. The third child will receive the balance of the estate in two equal payments. The first payment is due immediately and the second payment is due one year from now. Interest is at an effective annual rate of 8%. You are given that =6.7101. In which of the following ranges is the amount of the third child's second payment? $76,000 but less than $78,000 Less than $72,000 $74,000 but less than $76,000 $72,000 but less than $74,000 $78,000 or more
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