1) You recently purchased a Sirius satellite receiver. The monthly subscription rate is $12.95. You can either pay on a monthly basis or prepay an entire year and receive the 13th month free. Assuming you will maintain your subscription for at least 13 months, what is the effective annual rate of return on your investment if you choose to prepay for the entire year? All payments are due at the beginning of the month

2) If you invest $4,125 in a venture, you will receive $1,250 per year for the next 20 years. Assuming 15% interest, what is the discounted payback period for your investment?

3) The "Arctic Express" mutual fund company invests its monies in Russia. They claim that money invested with them will quadruple in value over the next 10 years. Suppose you decide to invest $200 per month for the next 10 years in this fund. If their claim is true, what effective annual rate of return (IRR) will you have earned in this fund?

4) f you invest $4,125 in a venture, you will receive $1,250 per year for the next 20 years. Assuming 15% interest, what is the discounted payback period for your investment?