5. a) In return for an immediate payment of 1500 and a further payment of 600 two years from now, an investor will receive 3000 five years from now. Show that the yield for this transaction lies between 8.3% and 8.4%. [7 marks] b) A small investor with 100 has the opportunity to invest in a project with cash-flow 0 time in years amount 12 8 8 3 4 5 6 7 8 9 8 8 8 8 8 10 118 -100 i) Calculate the net present value of the cash-flow on the basis of an effective rate of interest of 7% per annum. [4 marks] ii) Confirm that the yield of the cash-flow is 0.0866868. [3 marks] iii) Giving a reason, state whether the investor should take up the opportunity? [3 marks] iv) Giving a reason, state whether, with effective rate of interest of 7% per annum, the investment would still be worthwhile were the initial outlay 120. [3 marks]