Use the following cash flows to answer questions (a) and (b) below:

$50,000 today (T=0)

$42,000 in year 1 (T=1)

$34,000 in year 2

$26,000 in year 3

$18,000 in year 4

$10,000 in year 5

The interest rate is 7% :

A) What is the most an investor should be willing to pay for an investment with these cash flows? (PV?)

B) What would be the value of the cash flows in year 5 if the funds were deposited into an interest-bearing account?

C) What would be the value of the cash flows in year 10 if the funds were deposited into an interest-bearing account (assuming no addtl CFs occured)?