1. Suppose you invest $ 2,026 today to start a business. In 4 years you hope to sell this company for $ 8,865. What would be your annualized rate of return?

2. Assume that, starting next year, you put $ 662 into a savings account that pays 9 % interest every year. If you plan to do this for 12 years, what is the present value of your savings account?

3. Assume that starting next year you put $ 639 into a savings account that pays 8 % interest every year. How much will you have in your account after 17 years?

4. Congratulations! You just won a very special kind of lottery. Instead of receiving a large lump sum now, for tax reasons this lottery makes equal yearly payments of $ 5,760 for the rest of your life! The only catch is that you have to wait 2 years for the first payment. What is the present value of this lottery prize? The annual rate of interest is 8 %.

5. You must be very lucky, because you've won another lottery! This one is not forever, but will make payments of $ 1,194 a total of 5 times. Even better: the first payment is today! What is the present value of this lottery? The annual interest rate is 4 %.

6. Consider two investments that you can make. You can either buy a share of stock in a company that will pay a dividend of $ 15 every year into the foreseeable future, or a buy a special type of bond that will start paying the same $ 15 in one year, and thereafter that payment will increase at the rate of 1 %, for a total of 3 payments. If the interest rate is 4 % (in both cases), which investment is better? To answer this question, calculate the difference between the present values of each investment. That is, obtain the value that results for the present value of buying the stock minus the present value of buying the bond (that way, if the difference is positive then the stock is better, and viceversa). Enter your answer rounded to one decimal.

Please show the steps on using the financial caculator, Thanks!