would you pay? It mighl D and compare it to the situation in part a. from now, on January 1 c. Suppose the investment's first cash flow is 3 years 2022. On every January 1 thereafter you will receive $100. How muci worth to you today, January 1, 2019? Perpetuities You are evaluating an investment that will pay $75 in 1 v will continue to make payments at annual intervals thereafter, but the pa grow by 4% forever. a. W hat is the present value of the first $75 paymen b. How much cash will this investment pay 100 years from now? What is the ear, and it payments wil P5-28 t if the discount rate is 10%? i, pres ent value of the 100th payment? Again, use a 10% discount rate. c. What is the pr d. Explain why the an esent value of the entire growing stream of perpetual cash flows swers to parts a and b help to explain why an infinite strea of growing cash flows has a finite present value? Personal Finance Problem Creating an endowment On completion of her introductory finance course, M Lee was so pleased with the amount of useful and interesting kno that she convinced her parents, who were wealthy alumni of th -29