1) Suppose you signed a contract for a special assignment over the next 9 years. You will be paid $26,085 at the end of each year. If your required rate of return is 16.00%, what is this contract worth in today?
2) You need a loan to purchase new equipment. The loan will be paid off over 5 years with payments made at the end of every quarter. If the stated annual rate is 23.00% and quarterly payments are $232, what is the loan amount?
3) You would like to purchase a car for $16,503. If the car loan is 06.00% financed over 5 years, what will the monthly payments be for this car?
4) What is the most that you would pay for an investment that promises to pay $23,466 a year forever with the first payment starting one year from now? Assume that your required rate of return for this investment is 15.00%.
5) A loan has a stated annual rate of 16.00%. If loan payments are made monthly and interest is compounded monthly, what is the effective annual rate of interest?