1. Derek decides to buy a new car. The dealership offers him a choice of paying $598.00 per month for 5 years (with the first payment due next month) or paying some $28,605.00 today. He can borrow money from his bank to buy the car. What interest rate makes him indifferent between the two options?

2. Derek wants to withdraw $12,218.00 from his account 8.00 years from today and $13,422.00 from his account 12.00 years from today. He currently has $2,943.00 in the account. How much must he deposit each year for the next 12.0 years? Assume a 6.67% interest rate. His account must equal zero by year 12.0 but may be negative prior to that.