1. If you invest $2,000 today into a deposit account earning 4.5% interest compounded monthly, how much would your investment be worth in 8 years? 2. If you invest $5,000 today into a deposit account earning 6.25% interest compounded monthly, how much would your investment be worth in 5 years? 3. How much money would you need to invest today in order to have a lump sum of $40,000 in 18 years if the available interest rate is 8.5% compounded annually? 4. How much money would you need to invest today in order to have a lump sum of $100,000 in 40 years if the available interest rate is 12.5% compounded annually? 5. You plan to invest $1,000 at the end of each year for the next 10 years into an account paying 12.0% compounded monthly. The effective annual rate (EAR) for 12% compounded monthly is 12.6825%. How much will your investment be worth at the end of the ten years? 6. If you invest $300 at the end of each month for 10 years into an account paying 12.5% compounded monthly, to what amount will your investment accumulate at the end of the ten years? 7. You decided to borrow $20,000 for a new car. Your credit union offers an interest rate of 6.5% compounded monthly for three-year (36 month) car loans. What amount will your monthly payment be for this loan? 8. You want to borrow $150,000 for a mortgage on a new house. After shopping the internet for the best mortgage deals, you have locked in an interest rate of 6.375%, compounded monthly for a 30-year (360 month) loan. Calculate the amount of your monthly loan payment (principal and interest only) for this mortgage (ignore tax and insurance escrow). 9. A friend gave you a lottery ticket that matched all six numbers so you are now the proud owner of an annuity for the lottery jackpot. The $40,000,000 jackpot is to be paid out over 25 years with a payment of $1,600,000 at the end of each year. If an interest rate of 6% compounded annually is available, what lump sum amount today would equal the present value of this 25-year annuity.