If you required rate of return does not change how much

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You are willing to pay $15,625 to purchase a perpetuity that will pay you and your heirs $1,250 each year, forever. If you required rate of return does not change, how much would you be willing to pay if this were a 20-year annuity of $1,250 annual payment instead of a perpetuity?

Reference no: EM13566905

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