Annuity Review Problem: You are buying a perpetuity-immediate that makes annual payments X, X + 1,...
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Annuity Review Problem: You are buying a perpetuity-immediate that makes annual payments X, X + 1, X + 2, X, X + 1, X +2, X, X + 1, X +2, X,.... The price of the annuity is 40 when priced at (2) = 5%. Find X. A) 0.98 B) 1.00 C) 1.02 D) 1.04 E) 1.06 Annuity Review Problem: You are buying a perpetuity-immediate that makes annual payments X, X + 1, X + 2, X, X + 1, X +2, X, X + 1, X +2, X,.... The price of the annuity is 40 when priced at (2) = 5%. Find X. A) 0.98 B) 1.00 C) 1.02 D) 1.04 E) 1.06
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