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ssume that the Canada Pension s you per year ting when you retire 45 yea st $20,000 will come 45 years from now). If your discount rate is 7%, compounded annually, and you ears after retiring (so that you will get a total of 16 payments, including the first one), what is the value ension Plan's promise?

ssume that the Canada Pension s you per year ting when you retire 45 yea st $20,000 will come 45 years from now). If your discount rate is 7%, compounded annually, and you ears after retiring (so that you will get a total of 16 payments, including the first one), what is the value ension Plan's promise?

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Assume that the Canada Pension Plan promises you $20,000 per year starting when you retire 45 years from today (the first $20,000 will come 45 years from now). If your discount rate is 7%, compounded annually, and you plan to live for 15 years after retiring (so that you will get a total of 16 payments, including the first one), what is the value today of Canada Pension Plan's promise? The value today of the Canada Pension Plan's promise is $ (Round to the nearest dollar.) View an example Get more help - Clear all
Transcribed Image Text:Assume that the Canada Pension Plan promises you $20,000 per year starting when you retire 45 years from today (the first $20,000 will come 45 years from now). If your discount rate is 7%, compounded annually, and you plan to live for 15 years after retiring (so that you will get a total of 16 payments, including the first one), what is the value today of Canada Pension Plan's promise? The value today of the Canada Pension Plan's promise is $ (Round to the nearest dollar.) View an example Get more help - Clear all
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