1. You buy an apartment for investment in a very good area so you know this will be most of the time with tenants. The monthly rent you charge to the tenants is $5,000. You set in the contract a rate of increase in the rent of 5% per year. What should be the price of the department today? Use a 10% annual discount rate.

2. You bought 100 stocks from company XYZ. The company will pay dividends per 20 years starting at year 1. After that the company will disappear. The discount rate for company XYZ is 12%. What is the price of the company today? What would be the price today if the company pays dividends for 20 years but starting at year 3?