1. What is the price today of a $200,000 cash flow in 5 years if the discount rate is 2.5%
2. What is the price today of $200,000 to be received in 6 years if the rate of discount is 2.5%? Compare to #5.
3. An asset promises to pay $50,000 in five years and $100,000 in ten years. What is its price if the 5-year rate of discount is 10% and the 10-year rate of discount is 5%?