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Edward Jones Investments has offered you an investment opportunity that will provide you with
an 18-year cash flow stream (payment is made at the end of every year). The cash flow stream is
expected to grow by 8% per year, with the first year's cash flow expected to be 48,000 . How
much would you be willing to pay for this investment if you require a 24% rate of return?
(HINT: You want to find out the PV of a finite growing annuity.) $275 , 044.95 . $241 , 935.48 .
$220 , 791.74 . $211 , 503.62 .

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  • 1. Edward Jones Investments has offered you an investment opportunity that will provide you with an 18-year cash flow stream (payment is made at the end of every year). The cash flow stream is expected to grow by 8% per year, with the first year's cash flow expected to be 48,000 . How much would you be willing to pay for this investment if you require a 24% rate of return? (HINT: You want to find out the PV of a finite growing annuity.) $275 , 044.95 . $241 , 935.48 . $220 , 791.74 . $211 , 503.62 .