1) Professor runs up to you, short $1500. He offers to pay you $400 a year for the next 15 years if you spot him now. You try to do a rough calculation to determine if it's worth it assuming you trust his creditworthiness as much as you trust the US dollar. i) With the prevailing 1 year treasury rate at 3.20%, what is the value of the agreement (NPV) and should you take it? ii) Now lets change the story. Professor is not broke and a gambling addict. Instead, being very superstitious, he asks you as a student to stand near him during the game as a good luck charm. As a reward, he decides to offer you $50 a year in perpetuity. Being a hustler of a finance student, you decide to sell this agreement to another student. What would be the fair value of the sale assuming the same 1 year treasury rate at 3.20%?