Question: Financial Management Problem Set 1 1. You are currently 35 years old. You will receive $15,000 annually for the next 30 years. If the interest

Financial Management Problem Set 1 1. You are currently 35 years old. You will receive $15,000 annually for the next 30 years. If the interest rate is 8%, what would the present value of these cash flows be? You are seeking to buy a house and you are considering to take a mortgage. The price of the house today is $500,000. The annual interest rate for a 30-year mortgage is 4.75%, what is the minimum monthly payment you will have to make on your mortgage? 2. What is the present value of an investment that yields $500 every year for 10 years and a lump sum of $10,000 at the end of year 10? Assume 4% annual interest rate. 3

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