1. If the interest rate is 25 percent, the present value of $500 paid 2 years from now equals _________. 2. If the interest rate is 10 percent, the present value of $300 paid 1 year from now equals...

1. If the interest rate is 25 percent, the present value of $500 paid 2 years from now equals _________.

2. If the interest rate is 10 percent, the present value of $300 paid 1 year from now equals _________. If the $300 is received in 5 years, the present value will equal _________.

3.The present value of a fixed payment decreases when interest rates _________ (increase/decrease).

4. The present value of bonds paid over a 10-year period will _________ (rise/fall) with a fall in interest rates.