1. If you are willing to pay $49,180.00 today to receive $4,506.00 per year forever then your required rate of return must be ____%. Assume the first payment is received one year from today.

2. If you are willing to pay $21,054.00 today to receive a perpetuity with the first payment occurring next year then the payment must be $______. Assume a 4.00% discount rate

3. What discount rate would make you indifferent between receiving $3,991.00 per year forever and $5,916.00 per year for 24.00 years? Assume the first payment of both cash flow streams occurs in one year.

4.Today is Dereks 25th birthday. Derek has been advised that he needs to have $3,783,727.00 in his retirement account the day he turns 65. He estimates his retirement account will pay 5.00% interest. Assume he chooses not to deposit anything today. Rather he chooses to make annual deposits into the retirement account starting on his 29.00th birthday and ending on his 65th birthday. How much must those deposits be?

5.Suppose you deposit $2,624.00 into an account today. In 9.00 years the account is worth $3,872.00. The account earned ____% per year.