1) Recently, Jamie and Jake each bought new cars. Both received a loan from a local bank with a nominal interest rate of 12% where payments are made at the end of each month, and they both pay the same monthly payment. Jamie's loan is for $15,000; however, his loan matures at the end of 4 years (48 months), while Jake's loan matures in 5 years (60 months). After 48 months Jamie's loan will be paid off, but what will be the remaining balance on Jake's loan

2) Karen and her twin sister, Kathy, are celebrating their 30th birthday today. Karen has been saving for her retirement ever since their 25th birthday. On their 25th birthday, she made a $5,000 contribution to her retirement account. Every year thereafter on their birthday, she has added another $5,000 to the account. Her plan is to continue contributing $5,000 every year on their birthday. Her 41st, and final, $5,000 contribution will occur on their 65th birthday. So far, Kathy has not saved anything for her retirement but she wants to begin today. Kathys plan is to also contribute a fixed amount every year. Her first contribution will occur today, and her 36th, and final, contribution will occur on their 65th birthday. Assume that both investment accounts earn an annual return of 10 percent. How large does Kathys annual contribution have to be for her to have the same amount in her account at age 65, as Karen will have in her account at age 65?

3) What is the future value of an annuity of $150 per year (first cash flow occurs one year from today) for 43 years if the interest rate is 11% p.a.?

4) What is the future value exactly 29 years from today of a deposit of $4,832 made today into an account that pays interest of 10% p.a.?

5)If the price of a loaf of bread has tripled over the past 7 years, what has been the annual rate of inflation in the price of bread over that time period?

6)You are about to deposit $580 into one of the following savings accounts to be left on deposit for 25 years. Each bank offers an account with a different interest rate and compounding period. Assuming you want to maximize your wealth, how much money would be in the bank account that offers the best effective rate of return after 25 years? BANK A: 9.5 percent rate compounded semi-annually BANK B: 9.4 percent rate compounded monthly BANK C: 9.3 percent rate compounded daily BANK D: 9.2 percent rate compounded continuously (Enter the amount only - do not enter the bank letter. Round your answer to 2 decimal places and record your answer without a dollar sign and without commas)

7) What is the present value of 63 annual payments of $1,075 each with the first payment being received immediately? Assume you can invest money at a 10% stated rate with semi-annual compounding.

8) John Keene recently invested $2,250 in a project that is promising to return 10 percent per year. The cash flows are expected to be as follows:

End of Cash Year Flow 1 $540 2 $506 3 $558 4 ?? 5 $546

Note that the cash flow in year 4 is missing. Determine the Year 4 missing cash flow that will make the present value of this series equal to the amount John invested (that is, $2,250)? (Round your answer to 2 decimal places and record your answer without a dollar sign and without commas).

9) Your bank offers 3-year certificates of deposit with a stated rate of interest of 11.47% p.a., compounded quarterly. Your cousin (who works at Acme Bank and Trust, a competitor) wants to know what stated rate of interest you would require from them in order to switch your business to their bank. Acme's CD's are compounded on a monthly basis. What is the minimum stated interest rate you should ask for from Acme in order to make you indifferent to switching?

10) Assume that exactly three years ago I borrowed $417,000. My loan has an interest rate of 4.25% and the term of the loan is 30 years (with required payments to be made every month). If I made every required payment on time for the first 36 months of the loan, what is my current payoff on my loan (that is, immediately after making my 36th payment)?

11)Assume that the e-trade baby opened an investment account when he turned 2 (i.e., he made his first deposit into the account on his second birthday). His deposit on that day was for $50,000 (this was his royalty check from one of his commericials). Assume that he continued making deposits into the account every month (his first monthly deposit was exactly one month after he made his initial $50,000 deposit) for the next 35 months (thus, his last deposit is made on this 5th birthday). The amount of these monthly deposits was $2500 per month. If the interest rate that he earns on his account is 6.5% p.a., but with monthly compounding, how much money will be in his account when he turns 55 years old (that is, exactly 50 years after he makes his last monthly deposit into the account)