Question: Present discounted values (II): Repeat exercise for an interest rate of 1%, then for an interest rate of 5%. Arrange your answers in a table so you can more easily see the difference a change in the interest rate makes.
Exercise: Present discounted values (I): Compute the present discounted value of the following income streams. Assume the interest rate is 3%.
(a) $50,000, received 1 year from now.
(b) $50,000, received 10 years from now.
(c) $100 every year, forever, starting immediately.
(d) $100 every year, forever, starting 1 year from now.
(e) $100 every year for the next 50 years, starting immediately.