Question: A rich uncle has left you an inheritance structured as follows: you will receive your first payment of $7000 today, and a payment each year,

A rich uncle has left you an inheritance structured as follows: you will receive your first payment of $7000 today, and a payment each year, beginning one year from today, for the next 25 years (a total of 26 payments). Each payment after the first payment will be 2% larger than the payment before.

a) If the interest rate is 5% per year, what is your inheritance worth to you today?

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