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You have a loan outstanding. It requires making three annual payments of $1000 each at the end of the next four years. Your bank has
You have a loan outstanding. It requires making three annual payments of $1000 each at the end of the next four years. Your bank has offered to restructure the loan so that instead of making the three payments as originally agreed, you will make only one final payment in four years. If the interest rate on the loan is 1% what final payment will the bank require you to make so that it is indifferent to the two forms of payment?
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