A series of four annual constantdollar payments beginning with $30,000 at the end of the first year
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A series of four annual constant‐dollar payments beginning with $30,000 at the end of the first year is growing at the rate of 8% per year. Assume that the base year is the current year (n = 0). If the market interest rate is 13% per year and the general inflation rate (f̅) is 7% per year, find the present worth of this series of payments, based on
(a) Constant‐dollar analysis.
(b) Actual‐dollar analysis.
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