1. What is the present value of perpetuity of $100 per year if the appropriate discount rate is 7 percent? If interest rates in general were to double and the appropriate discount rate rose to 14 percent, what would happen to the present value of the perpetuity? 2. Find the effective annual rate if the simple interest rate is 6 percent and interest is paid semiannually. 3. ABC Inc. just borrowed $25,000. The loan is to be repaid in equal installments at the end of each of the next five years, and the interest rate is 10 percent. a. Set up an amortization schedule for the loan