7. Suppose a State of California bond will pay $1,800 five years from now. If the going interest rate on these 5-year bonds is 6%, how much is the bond worth today?*

a) $651.60

b) $684.18

c) $718.39

d) $941.12

e) None of the above

8. You want to buy a new sports car 3 years from now, and you plan to save $5400 per year, beginning one year from today. You will deposit your savings in an account that pays 5.2% interest. How much will you have just after you make the 3rd deposit, 3 years from now?*

a) $13,930

b) $14214

c) $14626

d) $14870

e) None of the above