(Calculating present values, LO 2) Answer the following questions:

a. A customer purchases $10,000 of goods. The goods will be paid for in cash in two years. How much revenue should be recorded on the date the goods are delivered, assuming a discount rate of 6%?

b. You are presented with an investment opportunity that will pay you $1,000 in one year, $2,000 in two years, and $3,000 in three years. At a discount rate of 10%, would you pay $5,000 for this investment?

c. A “zero coupon bond” is a type of long-term debt that pays no interest, but simply pays a single amount on the date the bond matures. Your broker offers you a zero coupon bond that will pay $10,000 in 20 years. How much would you pay for the bond today, if your discount rate were 12%?

d. You are presented with an investment opportunity that will pay you $3,000 in one year, $2,000 in two years, and $1,000 in three years. At a discount rate of 8%, what is the maximum amount you would pay for this investment?