1. You own a building that a local business wants to rent for the next 10 years. The business owner has offered to pay $40,000 today or pay $6,400 at the end of each of next 10 years. If your required rate of return is 10%, which payment schedule should you accept?
2. How much would you pay for the right to receive $12,000 at the end of 15 years if you can earn a 15% return on a real estate investment with similar risk?
3. What is the NPV of $600 received for the next four years and $1,500 received at the end of the fifth year if your required return is 10%?