1.Why would it be unwise (even it were allowed) to charge the purchase of a home to a credit card? Explain. Go beyond credit limit to consider factors such as interest rates, budgeting, etc.

2.A friend owes $10,000 on his credit card. He plans to stop making charges and pay off the balance. The card has a minimum payment of 5%. He figured correctly that 5% of $10,000 is $500. From that he concludes that he needs to make the 5% minimum payment for only 20 months because 20 x $500 = $10,000. Is your friend right? If not, explain the error in his reasoning. Exercise 20 in Section 4.4 is relevant to this topic.

3.If the inflation rate doubles, does the percentage decrease in buying power also double? If not, is the new percentage decrease in buying power more than twice the old one or less than twice the old one? Interpret your answer.

4.At a certain school, the probability off making the soccer team is 50%, and the probability of making the basketball team is 50%. A student concludes that it's sure bet to make one of those two teams because 50% + 50% = 100%. Do you agree with this reasoning? Explain your answer.

5.If you choose to live in California, there is a certain probability that you will experience an earthquake. In Hawaii, you may see a tidal wave. In Oklahoma, there is a high significant probability that you will witness a tornado. Have such probabilities affected your chosen living area in the past? Do you anticipate that they will in the future? Please explain.