1. Problem One: Amazon Inc. expects to receive $250,000 at the end of each year, for the next 20 years. The nominal interest rate is 2.50%. As shown in class, (a) use the Annuity Discount Formula to compute the present value of these future cash flows, (b) verify your answer by using the PV function in Excel. 2. Problem Two: As part of your early retirement planning, you plan to save $2,500 on a quarterly basis in an interest bearing account with an annual interest rate of 3.75%. (a) If you plan to retire in 25 years, how much money will you have then for retirement assuming quarterly compounding? (b) If you decide to reinvest your funds at maturity for an additional 5 years, under daily compounding, and an annual interest rate of 2.75%. How much money will you have at the end of the reinvestment process? 3. Problem Three: A constant growth annuity offers a coupon of $10,000 at the end of the first six months. The instrument has a duration of 10 years, and coupons are received on a semiannual basis. (a) If the market rate is 11.25%, and the growth rate is 2%, what is the present value of this annuity