1. Oxygen Optimization just bought a new filtration system for 212,400 dollars. To pay for the filtration system, the company took out a loan that requires Oxygen Optimization to pay the bank a special payment of 102,200 dollars in 6 year(s) and also make regular annual payments forever. The first regular payment is expected in 1 year and is expected to be 1,600 dollars. All subsequent regular payments are expected to increase by a constant rate each year forever. The interest rate on the loan is 12.33 percent per year. What is the annual growth rate of the regular payments expected to be? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.

2. Vivian owns a(n) laser tag center that is worth 318,515 dollars and is expected to make annual cash flows forever. The cost of capital for the laser tag center is 11.51 percent. The next annual cash flow is expected in one year from today and all subsequent cash flows are expected to grow annually by 3.43 percent. What is the cash flow produced by the laser tag center in 3 years from today expected to be?

3. You own two investments, A and B, that have a combined total value of 96,422 dollars. Investment A is expected to make its next payment in 1 month. A’s next payment is expected to be 370 dollars and subsequent payments are expected to grow by 0.74 percent per month forever. The expected return for investment A is 1.14 percent per month. Investment B is expected to pay 91 dollars each quarter forever and the next payment is expected in 3 months. What is the quarterly expected return for investment B? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.