Question.4393 - Ch. 9 Written AssignmentDetailsResolve the following problems (1, 6, 7, 9 from the book chapter). Show the calculations.1 . Your aunt promises to gift you $1,500 now, $1,700 one year from now, $1,900 two years from now, and $2,500 three years from now. You will deposit all four amounts in an account that bears 3% interest compounded annually. How much will be in the account at the end of the fourth year?6 . Tony owns a small business that he is attempting to sell. A potential buyer offers him $500,000 today, plus $1,500,000 two years from now and a balance of $1,700,000 three years from now. Tony always analyzes cash flows using a rate of 4% compounded annually. To compare this to other offers, which would be paid in cash immediately, he wants to know the present value of these future cash flows. Show the calculation and solution that you would present to Tony to use in his decision.7 . Continuing Problem 6 above, assume that as Tony receives each payment from the buyer, he can immediately invest it in a fund that returns a guaranteed 3.5% compounded annually. If he accepts the terms of this offer, how much will he have accumulated in this investment four years from now?9 . Abby owns a business that projects two years of strong cash flow, followed by a two-year hiatus while she pursues a graduate degree. She then plans to resume her business and is confident about the following two years of cash flow. At the end of each year, she will invest her profits in a fund that returns 3% compounded annually. Each investment will be made at the end of the year. Her expected investments are as follows:Year 1: $50,000Year 2: $78,000Year 3: 0Year 4: 0Year 5: $84,000Year 6: $89,000If Abby meets her expectations, how much money will she have in this fund at the end of year 7?

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