1)You deposit $5600 in a savings account that pays 12.5% interest, compounded annually. How much will your account be worth in 7 years?

6-2)In 1977, the average tuition for one year at an Ivy League school was $1200. Thirty years later, in 2007, the average cost was $14,250. What was the annual growth rate in tuition over the period?

6-3) What is the present value of a 7-year ordinary annuity with annual payments of $319, evaluated at a 18 percent interest rate?

6-4)You have the opportunity to buy a perpetuity which pays $112,564 annually. Your required rate of return on this investment is 13.2 percent. You should be essentially indifferent to buying or not buying the investment if it were offered at what price.

6-5)Assume that you will receive $3000 a year in Years 1 through 4, $2000 in Years 6 through 8, and 5000 in Year 9, with all cash flows to be received at the end of the year. If you require a 14 percent rate of return, what is the future value of these cash flows?

6-6)You borrow $150,000. You make annual payments (at the end of each year) for 8 years. The interest rate is 12%. A) What is your annual payment? B) How much interest do you pay in year 3?

6-7)You are currently investing your money in a bank account which has a nominal annual rate of 7.25 percent, compounded annually. How many years will it take for you to double your money?

6-8)The South Penn Trucking is financing a new truck with a loan of $20,000 to be repaid in 5 annual end-of-year installments of $5009.12. What annual interest rate is the company paying?

6-9)You are contributing money to an investment account so that you can purchase a house in seven years. You plan to contribute seven payments of $3950 a yearthe first payment will be made one year from now, and the final payment will be made seven years from now. If you earn 12% in your investment account, how much money will you have at the end of 7 years?

6-10)You have just taken out a 10-year, $12,000 loan to purchase a new car. This loan is to be repaid in 120 equal end-of-month installments. If each of the monthly installments is $150, what is the effective annual interest rate on this car loan?