Practice-

1.)

A)Find the value of a perpetuity which has an initial cash flow of $514. Assume a discount rate of 4.56%

a.~$2,880

b.~$514

c.~$23.44

d.~$2,343

e.~$11,271

B.)Find the present value of an annuity which pays 9 equal cash flows of $50 each starting one year from today.

Assume a discount rate of 4.73%.

a.$697.38

b.$1602.32

c.$359.70

d.$450

e.$21.28

C.)Using the formula for future value, determine the future value of an account, one period from now,

if the present value of an account is $607.54, the rate of return is 7.5%, and no other withdrawals or deposits are going to be made over the period.

a.$45.57

b.$1,063.20

c.$653.11

d.$7.54

e.None of the answers shown here.