You wish to endow a university chair of accounting for a salary of $100,000 per year to
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You wish to endow a university chair of accounting for a salary of $100,000 per year to the recipient. The university will withdraw $100,000 each year for the recipient’s salary. The amount of your gift will remain untouched indefinitely, in perpetuity. The university can lock in a fixed rate for your investment of 2.8% per year. In order to achieve this, what is the approximate amount of the gift you would have to make now?
a. $3,103,569
b. $3,571,429
c. $4,101,218
d. $4,227,827
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