1: What's the present value of a $980 annuity payment over six years if interest rates are 10 percent?

2: A particular securitys default risk premium is 4 percent. For all securities, the inflation risk premium is 3.90 percent and the real risk-free rate is 7.80 percent. The securitys liquidity risk premium is 0.10 percent and maturity risk premium is 0.70 percent. The security has no special covenants. Calculate the securitys equilibrium rate of return.

3: One-year Treasury bills currently earn 3.20 percent. You expect that one year from now, 1-year Treasury bill rates will increase to 3.40 percent and that two years from now, 1-year Treasury bill rates will increase to 3.90 percent. The liquidity premium on 2-year securities is 0.10 percent and on 3-year securities is 0.20 percent. If the liquidity premium theory is correct, what should the current rate be on 3-year Treasury securities?

4: Compute the future value in year 9 of a $3,600 deposit in year 1 and another $3,100 deposit at the end of year 5 using a 9 percent interest rate.