Noel Klinger Is Planning to Invest in an Insurance Company

Noel Klinger is planning to invest in an insurance company product. The product will pay $12,500 at the end of this year. Thereafter, the payments will grow annually at a 2.5 percent rate forever. Jack will be able to invest his cash flows at a rate of 5.5 percent. What is the present value of this investment cash flow stream? (Round to the nearest dollar.)

A) $326,908
B) $312,766
C) $416,667
D) $446,667