hello there i would like some help with my finance corportae question

Congratulations! You have just won a small lottery. It will pay you either 5 annual payments of $15,000 each (with the first payment to be received two years from today), or a single lump sum to be received today. If you can invest at a 6% annual rate of interest, what is the least you should accept as the lump sum payout amount?

1. $75,000.00
2. $66,976.58
3. $63,185.46
4. $59,608.92
5. $89,629.78

Time Value of Money Questions: 1. Assume that all other factors are held constant and that the interest rate is greater than zero. Increasing the number of periods (i.e., n) will cause the present value of a lump sum to be received in the future to _________ and the present value of an annuity to _______. a. b. c. d. e. Increase; Increase Increase; Decrease Decrease; Decrease Decrease; Increase It depends on whether the annuity is an annuity due or an ordinary annuity 2. Congratulations! You have just won a small lottery. It will pay you either 5 annual payments of $15,000 each (with the first payment to be received two years from today), or a single lump sum to be received today. If you can invest at a 6% annual rate of interest, what is the least you should accept as the lump sum payout amount? a. b. c. d. e. $75,000.00 $66,976.58 $63,185.46 $59,608.92 $89,629.78 3. Which of the following accounts would pay you the highest effective annual rate? a. b. c. d. e. Stated annual rate of 6.05%, compounded annually Stated annual rate of 6.01%, compounded semi-annually Stated annual rate of 5.95%, compounded quarterly Stated annual rate of 5.90%, compounded monthly Stated annual rate of 5.85%, compounded daily (assuming 365 days a year) 4. You have financed the purchase of a used Mercedes with a $31,500 loan with a 5-year term, monthly payments, and an 8% stated annual rate. What is the amount of your monthly loan payment? a. b. c. d. e. $657.45 $583.33 $477.92 $638.71 $350.00 5. You have just invested $3,000 into an account that will earn a 9% annual interest rate. You want to have exactly $8,000 in the account at the end of 5 years. The account allows you to make one deposit at the end of the 3rd year. In order to have exactly $8,000 at the end of year 5, how much must you deposit at the end of the 3rd year? a. b. c. d. e. $2,848.35 $2,613.17 $2,397.40 $3,384.13 None of the above answers is within $50 of the correct amount 6. Terry just celebrated her 20th birthday and she has decided to quit drinking Diet Coke. Terry currently drinks 2 cans of Diet Coke per day at an average cost of $0.75 per can. To reward herself for quitting, Terry plans to invest all that she will save each day (i.e., $1.50) into a savings account that currently pays 6% p.a. Assuming her first deposit into the account is made tomorrow, and assuming that there are 365 days per year, how much money will be in Terry's savings account on her 65 th birthday (i.e., 45 years or 16,425 days from today)? a. b. c. d. e. $27,629.13 $37,659.48 $49,906.76 $50,885.83 None of the above is within $1,000 of the correct answer. Stock and Bond Valuation Questions 7. A security that pays a constant dividend every year forever is known as: a. b. c. d. e. A zero-coupon bond Preferred stock Class A Common stock A Reverse Perpetual Mortgage obligation security A callable bond 8. A 10-year annual coupon bond was issued four years ago at par. Since then the bond's yield to maturity (YTM) has decreased from 9% to 7%. Which of the following statements is true about the current market price of the bond? a. b. c. d. e. The bond is selling at a discount The bond is selling at par The bond is selling at a premium The bond is selling at book value Insufficient information 9. What should be the price of a $1,000 par value, 10% annual coupon rate (coupon interest paid semiannually) bond with 30 years remaining to maturity, assuming a discount rate of 9%? a. b. c. d. e. $1,101.88 $1,102.44 $1,103.19 $1,104.48 $1,105.72 10. You have just discovered a $1,000 par value corporate bond with a maturity of 10 years. The bond's yield to maturity is 9% and the bond is currently selling for $743.29. What is the bond's annual coupon rate (the bond pays coupon payments annually)? a. b. c. d. e. 5% 6% 7% 8% 9% 11. What is the yield to maturity of a $1,000 par value bond with a coupon rate of 10% (semi-annual coupon payments) that matures in 30 years assuming the bond is currently selling for $838.13? a. 6.0% b. 6.2% c. 10.0% d. 12.0% e. 12.4% 12. XYZ, Inc. just paid a dividend of $3 per share. The industry analysts predict that XYZ's dividends will grow at a constant rate of 4% forever. If the stock is currently trading at $25 per share, what is the required rate of return on this stock? a. b. c. d. e. 8.48% 12.00% 12.48% 16.00% 16.48% 13. Unitongue Talk, Inc. just paid a $2.00 annual dividend. Investors believe that the dividends will grow at a rate of 20% per year for each of the next two years and 5% per year thereafter. Assuming a discount rate of 10%, what should the current price of the stock be? a. b. c. d. e. $60.50 $57.60 $54.55 $49.87 $43.56