For this question, suppose the market interest rate is 4%, and round all answers to the nearest $1:
a) What is the present discounted value of a perpetuity paying $100 per year, every year, with the first payment coming 6 years from today?
b) What is the present discounted value of a financial instrument that pays you $100 every other year, forever, starting two years from now? (i.e. you get paid after waiting 2 years, 4 years, 6 years, etc.)