2. A couple thinking about retirement decide to put aside $2,300 each year in a savings plan that earns 9% interest. In 15 years they will receive a gift of $27,000 that also can be invested.

a. How much money will they have accumulated 30 years from now? (accumulated savings)

b. If their goal is to retire with $730,000 of savings, how much extra do they need to save every year?

(additional annual saving needed)

3. In April 2016 a pound of apples cost $1.55, while oranges cost $1.19. Two years earlier the price of apples was only $1.34 a pound and that of oranges was $1.05 a pound.

a. What was the annual compound rate of growth in the price of apples?

b. What was the annual compound rate of growth in the price of oranges?

4. I now have $17,000 in the bank earning interest of .75% per month. I need $27,000 to make a down payment on a house. I can save an additional $100 per month. How long will it take me to accumulate the $27,000? (Time requirement ____ months)

5. A local bank advertises the following deal: Pay us $100 at the end of each year for 11 years and then we will pay you (or your beneficiaries) $100 at the end of each year forever.