Part 1a) Explain the concept of compounding.

Part 1b) How much more will you have if you invest $100,000 over 20 years at 6% compounded monthly versus compounding quarterly?

Part 2a) Congratulations! You just won a $10 million prize. The money will be paid in equal annual installments of $333,333.33 over 30 years. If the appropriate discount rate is 5%, how much is the prize worth today?

Part 2b)Explain what ordinary annuities, annuities due and perpetuities are.