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1) Your after-tax income is $75,000 per year and your financial advisor suggests that you set up an emergency fund. a)What amount should you have

1) Your after-tax income is $75,000 per year and your financial advisor suggests that you set up an emergency fund.

a)What amount should you have in the emergency fund?

b)What assets might you hold in your emergency fund?Explain your answer.

2) You have instructed your employer to deduct $150 from your paycheque at the start of every month.The money is invested at 4.2% per year compounded monthly.How much will you have saved in your account after 18 years?

3) Last year you received $1,600 in dividends from your investment in Telus common shares.You also earned $1,600 in interest from your investment in Government of Alberta 10-year bonds.Calculate the basic federal tax payable on each investment if your marginal tax rate is 29%.Show your work.

4) As of August 14, you have an outstanding credit card balance of $8,500 from purchases made over the past month.The new billing period starts tomorrow on August 15.The outstanding balance for the first 15 days is $8,500, and then you make a payment of $4,500, reducing the balance to $4,000, which is the outstanding balance for the remaining 15 days of the billing period.If the annual interest rate is 16% compounded daily, calculate the finance charges if the credit card issuer uses the:

a)Previous balance method

b)Average daily balance method

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