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1. Sirius Company wants to have $60,000 at the end of 8 years. The present value of $1, and the present value of an annuity

1. Sirius Company wants to have $60,000 at the end of 8 years. The present value of $1, and the present value of an annuity of $1 for eight periods at 10% are 0.467 and 5.335, respectively.

How much must Sirius invest today in a fund that pays 10% annually?

A. $8,000

B. $11,246

C. $28,020

D. $40,000

2. Dagwood Company needs to have $75,000 in four years. The present value of $1, and the present value of an annuity of $1 for four periods at 10% are 0.683 and 3.170, respectively.

How much must Dagwood invest today in a fund that pays 10%, compounded annually?

A. $68,182

B. $51,225

C. $23,659

D. $56,000

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