Determine the value of i, The annual payment received by

Determine the value of i

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Reference no: EM131962827

John purchases a 10-year annuity, and Paul purchases a 20-year annuity.

Both annuities make level payments at the end of each year, the cost of each annuity is the same, and both annuities are based on an effective annual interest rate of i.

The annual payment received by John is 1.5 times larger than the amount of the annual payment received by Paul. Determine i.

Reference no: EM131962827

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