1. a) A company estimates that it will need $53,000 in 17 years to replace a computer. If it establishes a sinking fund by making fixed monthly payments into an account paying 4.8% compounded monthly, how much should each payment be?

b) American General offers a 8-year annuity with a guaranteed rate of 6.05% compounded annually. How much should you pay for one of these annuities if you want to receive payments of $1400 annually over the 8 year period?

c) E-Loan, an online lending service, recently offered 60-month auto loans at 4.8% compounded monthly to applicants with good credit ratings. If you have a good credit rating and can afford monthly payments of $298, how much can you borrow from E-Loan? What is the total interest you will pay for this loan?