1.Jerry Rees invested $8,000 at 5% annual interest, and left the money invested without withdrawing any of the interest for 12 years. At the end of the 12 years, Jerry withdrew the accumulated amount of money.

(a) What amount did Jerry withdraw, assuming the investment earns simple interest?

(b) What amount did Jerry withdraw, assuming the investment earns interest compounded annually?

2. Ekman Company issued $1,000,000, 10-year bonds and agreed to make annual sinking fund deposits of $78,000. The deposits are made at the end of each year into an account paying 5% annual interest.

What amount will be in the sinking fund at the end of 10 years?

3.Orear Company earns 10% on an investment that will return $480,000, 8 years from now. What is the amount Orear should invest now to earn this rate of return?

4. Dayton Company is considering investing in an annuity contract that will return $45,000 annually at the end of each year for 15 years.What amount should Dayton Company pay for this investment if it earns a 5% return?

5. Kirby Railroad Co. is about to issue $300,000 of 10-year bonds paying a 9% interest rate, with interest payable semiannually. The discount rate for such securities is 8%.How much can Kirby expect to receive for the sale of these bonds?

6. Jimenez Enterprises issued 9%, 8-year, $2,600,000 par value bonds that pay interest semiannually on October 1 and April 1. The bonds are dated April 1, 2014, and are issued on that date. The discount rate of interest for such bonds on April 1, 2014, is 10%.What cash proceeds did Jimenez receive from issuance of the bonds?

7. Blake Mohr has been offered the opportunity of investing $25,490 now. The investment will earn 10% per year and at the end of that time will return Blake $80,000.How many years must Blake wait to receive $80,000?