Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2019. Each employee covered by the plan is entitled to a pension payment each year after retirement. On the basis of a discussion with the supervisor of the Personnel Department and an actuary from an insurance company, the controller develops the following information related to the pension plan. Average length of time to retirement 12 years Expected life duration after retirement 19 years Total pension payment expected each year after retirement for all employees. Payment made at the end of the year. Amount includes all employees. $415,000 per year The interest rate to be used is 8%. Required: Calculate the present value of this deferred annuity (at January 1, 2019).

Suppose there are three types of consumers who attend concerts at your university’s performing arts center: students, staff, and faculty. each of these groups has a different willingness to pay for tickets; within each group, willingness to pay is identical. there is a fixed cost of $1,000 to put on a concert, but there are essentially no variable costs. for each concert: i. there are 140 students willing to pay $20. (ii) there are 200 staff members willing to pay $35. (iii) there are 100 faculty members willing to pay $50. a) if the performing arts center can charge only one price, what price should it charge? what are profits at this price? b) if the performing arts center can price discriminate and charge two prices, one for students and another for faculty/staff, what are its profits? c) if the performing arts center can perfectly price discriminate and charge students, staff, and faculty three separate prices, what are its profits?