(a.) Suppose that you afford to pay $600.00 each month on a car payment. If you bank is willing to offer you afive-year loan at an annual percentage rate (APR) of 7.50%, what is the most you could spend on a car?

(b.) You currently have $1,000.00 and you want it to grow to $7,500 so you can purchase a used car. If it is invested at an annual interest rate of 9.00% compounded semiannually, how long will it take you to save?

(c.)You have $1,000.00. You want it to grow to $2,500.00 in 8 years as you forecast that this will be the price of a new computer then. What annualized rate of interest must you earn to achieve this goal if there is annual compounding?

(d.)Assuming a required rate of return of 13.00%, calculate the net present value (NPV) and the internal rate of return (IRR) for the two following mutual exclusive projects and suggest which of the two projects you would choose and why:

Year | Project A | Project B

0 - $365,000.00 | -$40,000.00

1 - $38,000.00 | $20,300.00

2 - $47,000.00 | $15,200.00

3 - $62,000.00 | $14,100.00

4 - $455,000.00 | $11,200.00