Question: A contract specifies that you will receive $1000 in one year, $1040 in two years, and annual payments that continue to grow at a 4%

A contract specifies that you will receive $1000 in one year, $1040 in two years, and annual payments that continue to grow at a 4% rate forever. If the appropriate discount rate is 7.5%, what is the value of this contract?

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