1.) For a fixed number of time periods, P/A decreases with the interest rate

true or false ?

2.) A car manufacturer gave the green light to design and test a new-concept self-driving car with revolutionary energy-savings and safety features. The project will start 2 years from now and will last 5 years. At the beginning of each year of the project, the company must have $1 million available to pay for that years expenses.

To guarantee the availability of funds for each year of the project, the companys CFO decided to invest some of the companys available cash now (i.e., 2 years before the start of the project) in an investment opportunity paying 5% interest rate per year. How much should the investment be?