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Annual effective interest rate

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Jim buys a perpetuity-immediate which pays X each year and has an annual effective interest rate of 2i. Tina buys a perpetuity-due which pays X at the start of the first year, and each subsequent payment decreases by 3.5% from the previous payment. Tina's annuity has an annual effective interest rate of i. Both annuities have the same present value. Find i, where i > 0. Give your answer as a percentage rounded to three decimal places

Reference no: EM131890837

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