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What is the present value of an annuity of n years that is growing at rate g and discounted at rate r? Hint: this is
What is the present value of an annuity of n years that is growing at rate g and discounted at rate r? Hint: this is similar to the lecture, except that the yearly payment is growing at rate g. In other words, what is the present value of A(1+g)/(1+r) + A((1+g)/(1+r))2 + + A((1+g)/(1+r))n ? Show your work.
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