1. You deposit $40,000 in a bank that pays 3% simple interest per year. What is the formula for calculating interest? How much will you have in your account at the end of 1.5 years?

2. Today, you borrow $6950 from your friend. The simple interest rate is 5% per annum, payable quarterly. How much interest will you pay at the end of 2 quarters from today? If you were to keep the money for 1 full year, how much interest will you pay at the end of 1 year, from today?