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Question 1

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Question 1.After placing $13,000 in a savings account paying annual compound interest of 3%, Leona will accumulate what amount if she leaves the money in the bank for 4 years?

Question 2. You have just introduced "must have" headphones for the iPod. Sales of the product are expected to be 20,000 units this year and are expected to increase by 16% annually in the future. What are the expected sales in each of the next three years? If the 20,000 units were expected to increase by 18% a year, what are the expected sales next year for this product?

Question 3/.   What is the present value of a $650 perpetuity discounted back to the present at 10%? What is the present value of the perpetuity?

Question 4What is the present value of a perpetual stream of cash flow that pays $80,000 at the end of one year and grows at a rate of 5% indefinitely? The rate of interest used to discount the cash flows is 10%. What is the present value of the growing perpetuity?

Question 5

1)You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:

What is the present value of investments A, B, and C if the appropriate discount rate is 10%?