1. First City Bank pays 8 percent simple interest on its savings account balances, whereas Second City Bank pays 8 percent interest compounded annually. If you made a deposit of $9,000 in each bank, how much more money would you earn from your Second City Bank account at the end of seven years? 2. You took a tax deduction on your taxes 12 years ago that saved you $2,000. Unfortunately, you made a mistake and were not supposed to take that deduction. The IRS waves any penalties because it was an honest mistake, but still charges you 1.5% per month with annual compounding (i.e. 18% per year) interest. How much do you now owe the IRS? (Ignore any laws preventing the IRS from trying to reclaim this money.)