Victoria (age 65) is about to begin receiving a CPP retirement pension of $11,000 per year. This pension is indexed to the Consumer Price Index (CPI). Assume that the annual pension will be paid in a single year-end payment, the CPI will rise 3% per year, and money is worth 6% compounded annually. What is the current economic value of: a. 20 years of pension benefits?(Round your answer to the nearest cent.) Current economic value of future pension payments $ b. 25 years of pension benefits? (Round your answer to the nearest cent.) Current economic value of future pension payments $

And then Bank recently announced that its next semiannual dividend (to be paid six months from now) will be $1.00 per share. A stock analysts best estimate for the growth in future dividends is 5% compounded semiannually. (Do not round the intermediate calculations. Round your answers to the nearest cent.) a. If you require a rate of return of 10% compounded semiannually on the stock, what maximum price should you be willing to pay per share? Ignore the present value of dividends beyond a 50-year time horizon. Maximum price $ b. What price do you obtain if you do not ignore dividends beyond 50 years? (Hint: Use a large value, say 999, for n in the present value calculation.) Maximum price $