Question

A business is expected to yield an annual income of 140000 for the next 11 years,...

A business is expected to yield an annual income of 140000 for the next 11 years, after which it will be sold for 11000. An investor wants an annual return on his investment of 5%. If he can establish a sinking fund earning an annual interest rate of 3%, how much should he pay for the business?

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