Question

# 1a. What is the present value of the following set of cash flows if the discount...

1a. What is the present value of the following set of cash flows if the discount rate is 13.9%? (the cash flows occur at the end of each period) (round answer to nearest penny and enter in the following format 12345.67)

Year 0 cash flow = -1400 (a negative cash flow)
Year 1 cash flow = 400
Year 2 cash flow = 2400
Year 3 cash flow = 1100
Year 4 cash flow = 2400

1b. A credit card company charges you an interest rate of 1.72% monthly (i.e., 1.72% per month on the card's outstanding balance). This rate is not a per annum rate (i.e., not an APR) but a rate per month. The effective annual rate is ______. Enter your answer as a percentage rounding to 100th of a percent, e.g., 12.34)

1c. How much must we invest at the end of each month to build a balance of \$630,000 over 11 years if we earn 12% per annum? (Round to nearest penny and enter, for example, as 123456.78)

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