1. The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $31,000 per year forever. If the required return on this investment is 6.30 percent, how much will you pay for the policy? (Round your answer to 2 decimal places. (e.g., 32.16))

Present Value $ _________

2. You are planning to make monthly deposits of $340 into a retirement account that pays 9 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 35 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Future Value $__________

3.

You want to be a millionaire when you retire in 35 years.

How much do you have to save each month if you can earn an 11.5 percent annual return? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Savings per month

$

How much do you have to save each month if you wait 15 years before you begin your deposits? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Savings per month

$

How much do you have to save each month if you wait 25 years before you begin your deposits? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Savings per month

$

4.

Find the EAR in each of the following cases (Use 365 days a year. Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)):

Stated Rate (APR)				Number of Times Compounded				Effective Rate (EAR)
	8.8	%			Quarterly			%
	17.8				Monthly
	13.8				Daily
	10.8				Infinite