1.

2.

A friend asks to borrow $46 from you and in return will pay you $49 in one year. If your bank is offering a 6.2% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $46 instead? b. How much money could you borrow today if you pay the bank $49 in one year? c. Should you loan the money to your friend or deposit it in the bank? What is the present value of $5,000 received: a. Twenty eight years from today when the interest rate is 9% per year? b. Fourteen years from today when the interest rate is 5% per year? c. Seven years from today when the interest rate is 2% per year