You have your choice of two investment accounts. Investment A is a 13-year annuity that features end-of-month $1,250 payments and has an interest rate of 7.5 percent compounded monthly. Investment B is a 7 percent continuously compounded lump sum investment, also good for 13 years. |
How much money would you need to invest in Investment B today for it to be worth as much as Investment A 13 years from now? |
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