1. What's the present value, when interest rates are 8.5 percent, of a $195 payment made every year forever? (Round your answer to 2 decimal places.)
2. What is the maximum that should be invested in a marketing project with gross margins of 40%, if the revenues are estimated at $10,000/yr for 5 years, and the cost of capital is 10%?
3. What would be the principal ballon payment (that is excluding the fixed monthly payment) at the end of 5 years on a $150,000 loan with monthly payments based on a 30-year term at 12 percent compounded monthly?