A rich aunt has promised you $3,000 one year from today. In addition, each year after that, she has promised you a payment (on the anniversary of the last payment) that is 5% larger than the last payment. She will continue to show this generosity for 30 years, giving a total of 30 payments. If the interest rate is 5%, what is her promise worth today?

Answer rating: 100% (QA)

To calculate the present value of the promised payments we need to discount each payment to its pres... View the full answer