Compute the future value of a $125 cash flow for the following combinations of rates and times.(Round your answers to 2 decimal places.)

a.r= 8%;t= 10 years

b.r= 8%;t= 20 years

c.r= 4%;t= 10 years

d.r= 4%;t= 20 years

If you earn 9% per year on your bank account, how long will it take an account with $105 to double to $210?(Round your answers to 2 decimal places.)

In 1880 five aboriginal trackers were each promised the equivalent of 50 Australian dollars for helping to capture the notorious outlaw Ned Kelley. In 2001 the granddaughters of two of the trackers claimed that this reward had not been paid. The prime minister stated that if this was true, the government would be happy to pay the $50. However, the granddaughters also claimed that they were entitled to compound interest.

a.How much was each granddaughter entitled to if the interest rate was 4%?(Round your answers to 2 decimal places.)

b.How much was each entitled to if the interest rate was 8%?(Round your answers to 2 decimal places.)

Your wealthy uncle established a bank account with $2,600 for you when you were born. For the first 7 years of your life, the interest rate earned on the account was 5%. Since then, rates have been only 3%. Now you are 22 years old and ready to cash in. How much is in your account?(Round your answers to 2 decimal places.)

What is the present value of the following cash-flow stream if the interest rate is 4%?(Round your answers to 2 decimal places.)

Year Cash Flow

1 $ 270

2 470

3 370

A factory costs $300,000. You forecast that it will produce cash inflows of $90,000 in year 1, $150,000 in year 2, and $240,000 in year 3. The discount rate is 11%.

a.What is the value of the factory?(Round your answers to 2 decimal places.)

b.Is the factory a good investment?