1A.1 Suppose you were offered $5,000 to be delivered in 1 year.

Further suppose you had the alternative of putting money into a safe certificate of deposit paying annual interest at 8 percent. Would you pay $4,800 in exchange for the $5,000 after 1 year? What is the maximum amount you would pay for the offer of $5,000? Suppose the offer was $5,000, but delivery was to be in 3 years instead of 1 year. What is the maximum amount you would be willing to pay?