A particular investment promises a fixed returns of $5,500 at the end of each of the next 6 years. Assuming you expect an annual return of at least 12% on all your investments, answer the following:

a) What is the maximum amount you are willing to pay for this investment now?

b) If you are prepared to pay up to $27,000 for this investment, calculate the revised annual rate of return (in % p.a.) you are asking on this investment.