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12. What is the present value of $100 per year forever if the interest rate is 7%? Son 7 13. A perpetuity promises to pay
12. What is the present value of $100 per year forever if the interest rate is 7%? Son 7 13. A perpetuity promises to pay you $1000 per year. If the interest rate is 5%, what is this worth to you today? 14. You are interested in buying a new car. You will finance $20,000 for 5 years at an interest rate of 5.9%. What is your monthly payment? 15. You are saving for retirement. If you save $1000 a month for the next 40 years, how much will you have when you retire? Assume the interest rate is 6% per year. 16. Refer to Problem 15 above. You wish to have your retirement money last you for 30 years after retirement. How much money will your savings give you to spend every year etirement? Assume an interest rate of 3% per year
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