A local bank advertises the following deal Pay us $100 at the end of each year for 12 years and then we will pay you (or your beneficiaries) $100 at the end of each yearforever a Calculate the present value of your payments to the bank if the interest rate available on other deposits is 5 00 (Do not round intermediate calculations Round your answer to 2 decimal places ) Present value $ b What is the present value of a $100 perpetuity deferred for 12 years if the interest rate available on other deposits is 5 00 (Do not round intermediate calculations Round your answer to 2 decimal places ) Present value $ c Is this a good deal Yes No A local bank advertises the following deal Pay us $100 at the end of each year for 12 years and then we will pay you (or your beneficiaries) $100 at the end of each year forever a Calculate the present value of your payments to the bank if the interest rate available on other deposits is 5 00 (Do not round intermediate calculations Round your answer to 2 decimal places ) Present value $ b What is the present value of a $100 perpetuity deferred for 12 years if the interest rate available on other deposits is 5 00 (Do not round intermediate calculations Round your answer to 2 decimal places ) Present value c Is this a good deal Yes No $

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A local bank advertises the following deal: Pay us $100 at the end of each year for 12 years and then we will pay you

A local bank advertises the following deal: Pay us $100 at the end of each year for 12 years and then we will pay you (or your beneficiaries) $100 at the end of each yearforever.

a.	Calculate the present value of your payments to the bank if the interest rate available on other deposits is 5.00%.(Do not round intermediate calculations. Round your answer to 2 decimal places.)

Present value

b.	What is the present value of a $100 perpetuity deferred for 12 years if the interest rate available on other deposits is 5.00%.(Do not round intermediate calculations. Round your answer to 2 decimal places.)

Present value

Is this a good deal?

Yes

A local bank advertises the following deal: Pay us $100 at the end of each year for 12 years and then we will pay you (or your beneficiaries) $100 at the end of each year forever. a. Calculate the present value of your payments to the bank if the interest rate available on other deposits is 5.00%. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value $ b. What is the present value of a $100 perpetuity deferred for 12 years if the interest rate available on other deposits is 5.00%. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value c. Is this a good deal? Yes No $