1. Quantum Pizza took out a loan from the bank today for 21,600 dollars. The loan requires Quantum Pizza to make a special payment of 12,900 dollars to the bank in 7 years and also make regular, fixed payments of X to the bank each year forever. The interest rate on the loan is 10.61 percent per year and the first regular, fixed annual payment of X will be made to the bank in 1 year. What is X, the amount of the regular, fixed annual payment?
2. An investment, which is worth 29,800 dollars and has an expected return of 9.94 percent, is expected to pay fixed annual cash flows forever with the next annual cash flow expected in 1 year. What is the present value of the annual cash flow that is expected in 4 years from today?
3. You own a building that is worth 69,200 dollars and is expected to produce quarterly cash flows of 950 dollars forever. The first quarterly cash flow is expected in 3 months from today. What is the expected quarterly cost of capital for the building? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
4. Violet Sky Technology just bought a new apple orchard. To pay for the apple orchard, the company took out a loan that requires Violet Sky Technology to pay the bank a special payment of 17,770 dollars in 4 month(s) and also pay the bank regular payments of 1,870 dollars each month forever. The interest rate on the loan is 0.72 percent per month and the first monthly payment of 1,870 dollars will be paid in 1 month. What was the price of the apple orchard?