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3. (3 points) What is the present value of the following series of cash payments: $3,000 per year for four consecutive years starting one year
3. (3 points) What is the present value of the following series of cash payments: $3,000 per year for four consecutive years starting one year from today, followed by annual cash payments that increase by 2% per year in perpetuity (i.e. cash payment in year 5 is $3,0001.02, cash payment in year 6 is $3,0001.022, etc.)? Assume the appropriate discount rate is 6%/ year
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