Alfred Smith wants to purchase life insurance that will guarantee his family $50,000 (in R-dollars) per year

Question:

Alfred Smith wants to purchase life insurance that will guarantee his family $50,000 (in R-dollars) per year in bond interest income forever. The interest rate (i_m) from corporate bonds is expected to pay 8% per year, and the inflation rate is expected to average 3% per year. How much life insurance should Alfred purchase to protect his family forever?

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