a) what is the most you would be willing to pay for an investment that will pay you $553.00 in one year, $465.00 in two years, and $749.00 in three years if your required rate of return for this type of investment is 13.12%?
b) Supposed you signed a contract for a special assignment over the next 16.0 years. You will be paid $4,249.00 at the end of each year. If your required rate of return is 17.77%, what is this contract worth today?
c) You need a loan to purchase new equipment. The loan will be paid off over 14.0 years with payments made at the end of every quarter. If the stated annual rate is 17.91% and quarterly payments are $270.00, what is the loan amount?
d) What is the most that you would pay for an investment that promises to pay $6,296 a year forever with the first payment starting one year from now? Assume that your required rate of return for this investment is 23.87%.