Problem

You are offered an annuity that will pay $10,000 a year for 10 years (that is, 10 paymen...

You are offered an annuity that will pay $10,000 a year for 10 years (that is, 10 payments) starting after five years have elapsed. If you seek an annual return of 8 percent, what is the maximum amount you should pay for this annuity?

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Solutions For Problems in Chapter 7