Walt is evaluating an investment that will provide the following returns at the end of each of the following years: year 1, $12,500; year 2, $10,000; year 3, $7,500; year 4, $5,000; year 5, $2,500; year 6, $0; and year 7, $12,500. Walt believes that he should earn 12 percent compounded annually on this investment.

Required:

a. How much should he pay for this investment? b. How much should he pay if he expects to earn an annual return of 9 percent compounded monthly?

Note: For all requirements, do not round intermediate calculations and round your final answers to the nearest whole dollar amount.