1. John has just turned 20 years old. His parents are willing to buy him a car on his 30th birthday. The car is now priced $60,000 and expected to increase at a constant growth rate by 10% annually until the parents are ready to buy it. How much must John's parents invest per year to be able to purchase the Jeep in ten years? (Knowing that the rate of return is 10%). OA) $2,503.98 B) $9,764.72 C) $10,578.45 D) $27,615.15 O E) None of the above E 2. You want to go to Europe 5 years from 5 now, and you can save $3,100 per year, beginning one year from today. You plan to deposit the funds in a mutual fund that you think will return 8.5% per year. Under these conditions, how much would you have just after you make the 5th deposit, 5 years from now? * A) $18,369 B) $19,287 C) $20,251 D) $21,264 O E) None of the above 3. A lottery claims its grand prize is $40 million, payable over 40 years at $1,000,000 per year. If the first payment is made immediately, what is the grand prize worth? Use an interest rate of 12%. * O A) $9,233,030 B) $8,243,777 C) $9,243,777 D) $8,233,030 E) None of the above