1. For all the questions that follow, assume that the interest rate - R is 10% per annum. a. What is the present value of a cash inflow of $1464.1 received at the end of year 4? Compounding frequency is annual. b. What is the future value of investing $1000 today at the end of year 4 if the compounding frequency is once every two months? 2. Consider the following investment alternatives: For each alternative, calculate the EAR and indicate the best option according to your calculations. 3. You are asked to value a small startup that is expected to generate the following cash flows: That is negative cash flows during the first three years before it turns profitable in year 4 . Its first positive cash flow (in year 4) is equal to $400,000 and expected to remain the same each year forever. The discount rate is equal to 10% per year (compounded annually) and is assumed to remain constant. a. How much is it worth the start-up today (t=0) ? b. How much is the startup worth at t=2 if the positive cashflows grow at 2% starting year 5