A 1. A = P(1 + in) 2. P= (1 + in) 3. A P(1+1) 4. P= (1+0) 5. A=R[(1+1)-1] Ai (1+i)-1 6. R= 7. A =R[1-(1+i)] 8. R= Ai 1-(1+i)n No Calculator For each question, provide the 1. formula (number is sufficient); 2. periodic rate of interest; 3. number of periods; and 4. either A, P, or R as amount. Comment parts 2, 3, and 4, are the values you would plug into the formula to get the answer. For example: Formula = 5 = 0.1.7 n = 245/9 Amt. = $45 (recall: Examples may not provide correct answers). 1. Due to inflation, the worth of the dollar over a ten year period is reduced by the product of its original value (ie., $1) and the rate of inflation over that period of time (annual rate of inflation is 4%). What will be the value of $1000 in 10 years? Hint: This is linear growth. Formula = - i= 0.04 n = 10 Amt. = 675.56 2. Pete is making $200 monthly car payments for 3 years. The amount she owes (balance) increases monthly by 1% of the current balance; what was the purchasing price of Pete's car? Formula = n = Amt.= 3. Ally purchased a home for $190,000. Based on a 30-year home loan compounded monthly by 1%, how much are her monthly payments? Formula = n= Amt.= 4. At the end of each month, you make routine deposits of $100 into an account. Interest, which is the product of the current account balance and the monthly rate of interest (annual rate is 6%) is added to the balance a moment before you make your next monthly deposit. How much is in your account after 5 years? Formula = n = Amt= 5. Ben deposits monthly into an account that unfortunately depreciates at a monthly rate of 0.5 % (compounded monthly). The value of Ben's account after 2 years is $2000; how much did Ben deposit monthly? Formula = n => Amt. = - N