1. Suppose that you own a local auto dealership, Carmen and Rodrigos Sales (CARS). Your dealership will finance a new car purchase at an APR of 13%, compounded monthly. The terms of the financing are monthly payments of $332 for five years. The first payment is due one month after the buyer purchases the vehicle.

How much of the purchase price would the buyer be financing with the loan from your dealership?

Do not round at intermediate steps in your calculation. Round your answer to the nearest dollar. Do not type the $ symbol or a minus sign.

2. Suppose that you forecast a nominal rate of return of 7.4% per year, compounding annually on your stock portfolio, for the next 39 years. However, you also forecast an inflation rate over this period of 3.9% per year, compounded annually. What is forecast of your real rate of return?

Express your answer in percent, and round your answer to two decimal places. Do not type the % symbol.