How much will you be willing to pay

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1) i: You are considering an investment that will pay you $1475 in one year, $2255 in two years and $3360 in three years. If you want to earn 11% on your money, how much will you be willing to pay? Round and answer to the nearest cent.

ii. You are offered an investment that will pay you $1000, $1200, $1500, $1700, $2000, $2500, $3000, and $3500 over the next eight years (one cash payment per year). You require a 6% return on your investment. What is the most you would invest today? (In other words, what is the present value of this cash flow stream?) Round to the nearest cent.

Reference no: EM132234714

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