1. You are purchasing a TV and can pay for it in one of two ways. (a) Pay now and receive 30% discount on full retail. (b) Pay in six months and receive a 25% discount off full retail. At what effective rate of annual interest are these two payment methods equivalent?

2. I win a prize at the local state gambling emporium and can claim my winnings in one of two ways. (a) $50,000 now and an additional $50,000 in three years. (b) $80,000 now. At what interest rate are these two methods equivalent?