1) You are considering an investment that will pay you $12,000 the first year, $13000 the second year, 17,000 the third year, 19,000 the fourth year, 23000 the fifth year, and 28,000 the sixth year. What is the maximum you would pay for this investment if your opportunity cost is 12% with daily compounding?
2) How much would you be willing to pay for an investment that will pay you and your heirs $16000 each year in perpetuity if your opportunity cost is 6%? b) if you want the payments to grow by 2% indefinitely. (first payment: $16,000)?