Approximate present value of the donor

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Suppose you are putting on a fundraiser for a local charity. One donor agrees to give to the charity 10% of their income each year indefinitely. Their income is $500,000 per year. They would also like to make sure that their annual donation keeps up with an inflation rate of 2%. What would be the approximate present value of the donor's charitable contributions if you assume an annual interest rate of 5%?

Reference no: EM132541093

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