1. The Perpetual Life Insurance Co is trying to sell you an investment policy that will pay you and your heirs $10,113 per year forever. Suppose the Perpetual Life Insurance Co. told you the policy costs $179,869. At what interest rate would this be a fair deal? Just enter the number in percentages up to 2 decimal points. 

3. Assume interest rate of 3%. A company receives cash flows of $82,457 at the end of years 4, 5, 6, 7, and 8, and cash flows of $209,728 at the end of year 10. Compute the future value of this cash flow stream.

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4. Kelly starting setting aside funds 5 years ago to buy some new equipment for her firm. She has saved $4,920 each quarter and earned an average rate of return of 4 percent. How much money does she currently have saved for this purpose?

5. The ABC Company is considering a new project which will require an initial cash investment of $10,308. The projected cash flows for years 1 through 4 are $8,260, $8,800, $9,710, and $5,869, respectively. If the appropriate discount rate is 8%, compute the NPV of the project.

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