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You just inherited some money, and a broker offers to sell you an annuity that pays $ 1 3 , 7 0 0 at the

You just inherited some money, and a broker offers to sell you an annuity that pays $

13, 700

at the beginning of each year for

20

years. You could earn

5 %

on your money in other investments with equal risk. What is the most you should pay for the annuity?

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