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7) $3,947 deposited four years ago has grown to $5,000. What semiannually compounded rate of interest has the bank been paying? a. 5.26% b. 6.00%

7) $3,947 deposited four years ago has grown to $5,000. What semiannually compounded rate of interest has the bank been paying?

a. 5.26%

b. 6.00%

c. 3.00%

d. 6.67%

8. Designs Now is opening a showcase office to display and sell its computer designed poster art. Designs expects cash flows to be $120,000 in the first year, $180,000 in the second year, $240,000 in the third year. If Designs uses 11 percent as its discount rate, what is the present value of the cash flows?

a. $429,720

b. $457,620

c. $456,000

d. $424,820

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