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How much money does he need to purchase this annuity today

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John Smith is nearing retirement. He wants to purchase an annuity that will pay him $125,000 each year (with the first payment starting 1 year from now) for the next 30 years. The discount rate is 8%. How much money does he need to purchase this annuity today (assuming no commissions or extra fees by the company selling it to him)? Round to the nearest dollar.

Reference no: EM131829444

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