1. You wish to retire with $5 Million in 45 years. You estimate you will earn 8% on your investments. How much must you invest each year in order to reach your goal?
   1. Ordinary(1^stpayment made at the end of the year)

2. Due(1^stpayment made today
3. You would like to withdraw $60,000 per year during retirement. You expect to live 20 years after you retire at age 65. How much do you need to have saved by the time you retire if you can earn 4% on your funds?

Present Value of an Annuit

As a part of an agreement for investing in a start-up company, you will receive $5,000 at the end of each year for the next 5 years. If the agreed upon interest rate is 10%, what is the amount of money you are required to invest.

4. Part A) From the sale of your family property, you will receive a down payment of $15,000 today and then yearly payments of $15,000 for the next 14 years. If the discount rate is 7% compute the present value of your future payments.
5. Part B) Instead of receiving annual payments, you could receive one $135,000 lump sum payment today. Should you take the lump sum instead?

Perpetuity

You plan to purchase a small service company. You anticipate receiving annual cash flows of $50,000 per year forever. (A) If you require an 10% return on your investment, what is the most you should pay for this company? (B) What is the NPV if you can purchase it for $500,000?

You must show your work. Please indicate your keystrokes and highlight the final answer.