An investment earning simple interest is preferred over an investment earning compound interest because the simplicity adds value. A) True B) False a1 a2 The present value of $1,000 to be received in 5 years is $if the discount rate is 12.78% A) $368 B) S494 C) $548 D) $687 Joe borrowed S 10,000 at 10% per year and promised to pay it back in equal annual installments of principal and interest at the end of each of the next 5 years. Joe's annual payment wili be Q3 3,000 using the formula S3,000-[($10,000/5) + ($10,000 x 10%) A) True B) False Q4 You decide to borrow S 250,000 to build a new home. The bank charges an interest rate of 8% compounded monthly. If you pay back the loan over 30 years, what will your monthly payments be (rounded to the nearest dollar)? A) $1,123 B) $1,237 c) $1,687 D) $1,834