1. You are thinking about buying the Ben Paradigm for $4.95 million. The owner needs to sell soon so he says hell sell it to you for $4 million if you pay him $6 million in five years. What is the interest rate on this loan?

2. You are just starting graduate school part-time, and youve decided you want to buy a used Pete's watch when you graduate in four years. The watch will cost $34,995. You think you can save $600 a month during your four years of college. If interest rates are about 4%, will you be able to buy the watch when you graduate?

3. You are thinking about buying Siesta Key off the coast of Florida for $15.8 million. The owner says that if you give him a $2 million down payment, he will give you a 30-year, 5% loan. If you buy it, what will your monthly payment be?

4. If you deposit $1,000 into an account that pays 3% interest, how much will you have in twenty years?