Q1)Suppose you save $4,000 per year at the end of each year for 3 years and earn 5% interest per year. How much will you have at the end of 3 years? a)Suppose you save $4,000 per year at the end of...


Q1)Suppose you save $4,000 per year at the end of each year for 3 years and earn 5% interest per year. How much will you have at the end of 3 years?



a)Suppose you save $4,000 per year at the end of each year for 10 years and earn 8.5% interest per year. How much will you have at the end of 10 years?



b)Suppose you save $1,000 per year at the beginning of each year for 3 years and earn 5% interest per year. What is the present value of this annuity?


c)Suppose you save $500 per year at the end of each year for 15 years and earn 8.25% interest per year. What is the present value of this annuity?



d)Suppose that the constant and perpetual cash flow is $1,000 and the discount rate is 8%. What is the value of this perpetuity?



e)Suppose that the constant and perpetual cash flow is $1,000 and the discount rate is 10%. What is the value of this perpetuity?



Jun 08, 2022
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