1. A bank quotes certificate of deposit (CD) yields both as annual percentage rates (APR)without compounding and as annual percentage yields (APY) that include the effects ofmonthly compounding. A $100,000 CD will pay $110,471.31 at the end of the year. Calculate the APR and APY the bank is quoting.

2. A companyscash flows in 1995 are$0.88. Over the next eight years, the dividends were$0.91, $0.99, $1.12, $0.95, $1.09, $1.25, $1.42, and $1.26. Calculate the annuallycompounded growth rate of the cash flowsover the whole period.