QUESTION 5 You have the chance to purchase the royalty interest in an oilwell. Your best estimate is that the net royalty income will average $25 000 per year for five years. There will be no residual value at that time. Assume that the cash inflow occurs at each year-end and that considering the uncertainty in your estimates, you expect to earn 15% per year on the investment. What should you be willing to pay for this investment now? Would this figure be different ifthe discount rate used in your present value calculation was 8%? Explain