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a) Suppose that the cleanup hitter for the Atlanta Braves promises to donate $614.00 for every homerun he hits. The donations will be made at the end of each season on November 1st. The next payment will be made exactly one year from today. The hitter will play for 9.00 more seasons and expects to hit 27.00 homeruns per year. If the charity can earn 4.00% for this investment, what is the future value of his contribution?

b) A lottery winner will receive annual end of year payments of $95,993.00. If the lottery winner invests 24.00% of each payment to a mutual fund that pays 5.00% APR, what is the future value of his account after 15.00 years?

c) An investor contributes $547.00 per quarter in an account that pays 5.92% APR with quarterly compounding. The first contribution will be made next quarter. What is the future value of this account in 12.00 years?

d) An investor is considering the following opportunity: He will put capital into a start-up company today. He will not receive any cash flows from the investment until end of the 5th year. At that point, he will receive 12.00 years of $9,900.00 per year. If his discount rate on this investment is 19.00%, what is the value of this opportunity today?

Financial Management, Finance

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