1.Inflation causes things to cost more, and for our money to buy less (hence your grandparents saying "In my day, you could buy a cup of coffee for a nickel"). Suppose inflation decreases the value of money by 2% each year. In other words, if you have $1 this year, next year it will only buy you $0.98 worth of stuff. How much will $100 buy you in 10 years?

2.Suppose you want to have $300,000 for retirement in 25 years. Your account earns 5% interest.

a) How much would you need to deposit in the account each month?

b) How much interest will you earn?

3.Marcus buys a bag of cookies that contains 9 chocolate chip cookies, 5 peanut butter cookies, 9 sugar cookies and 7 oatmeal cookies.

What is the probability that Marcus reaches in the bag and randomly selects an oatmeal cookie from the bag, eats it, then reaches back in the bag and randomly selects a sugar cookie?

Give the answer as a fraction, or accurate to at least 4 decimal places.

4.A company estimates that 0.4% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $50.

If they offer a 2 year extended warranty for $5, what is the company's expected value of each warranty sold?

5. The patient recovery time from a particular surgical procedure is normally distributed with a mean of 5.7 days and standard deviation of 1.2 days. Use your graphing calculator to answer the following questions. Write the answers inpercentform. Round your answers to the nearest tenth of a percent.

a) What is the probability of spending less than 9 days in recovery? %

b) What is the probability of spending more than 4 days in recovery? %

c) What is the probability of spending between 4 days and 9 days in recovery? %