Laura Drake wishes to estimate the value of an asset expected to provide cash inflows of $$3,000$ per year for each of the next four years and $$15,000$ in five years. Her research indicates that she must earn $4\%$ on low$-$risk assets, $7\%$ on average$-$risk assets, and $14\%$ on high$-$risk assets.

a$.$ Determine what is the most Laura should pay for the asset if it is classified as $(1)$ low$-$risk, $(2)$ average$-$risk, and $(3)$ high$-$risk.

b$.$ Suppose that Laura is unable to assess the risk of the asset and wants to be certain she$$s making a good deal. On the basis of your findings in part a$,$ what is the most she should pay? Why?

c$.$ All else being the same, what effect does increasing risk have on the value of an asset? Explain your answer in light of your findings in part a$.$

Please show your work and show the exact formulas to enter into Excel to compute the amounts.