Please show all steps. (1) You are negotiating a professional sports contract pension payment. Upon your retirement, you have been given two choices: $500,000 per year for 5 years (a total of $2,500,000) or $250,000 per year for 12 years (a total of $3,000,000). Which pension has the highest value? Assume payments occur at the end of each year, and use a 7% interest rate. (2) Assume the following information for a car note:

Original loan amount = $18,500 Annual interest rate = 5.125% Term of loan = 60 months

For year three, how much interest and principal was paid, and what is the balance due at the end of year three? (3) What is the Net Present Value (NPV) and internal rate of return (IRR) of spending $275,000 today on medical school when you earn $50,000/year today and will earn $100,000/year for the next 35 years after med school. Assume you could invest this money elsewhere and earn 16%? (4) What is the effective interest rate assuming the following:

Annual rate = 12.0%

Pmt/yr = 4