Present Values A 3-year annuity of six £5,000 semiannual payments will begin 10 years from now, with the first payment coming 10.5 years from now. If the discount rate is 10 per cent compounded monthly, what is the current value of the annuity?

1. What is the most that Hreon should invest today before the investment becomes unattractive?
2. Assuming that this is what Hreon actually borrows to fund the new investment, how much would they have to repay each year if they borrowed the funds at a rate of 8 per cent?