(Annuity interest rate) Your folks just called and would like some advice from you. An insurance agent just called them and offered them the opportunity to purchase an annuity for $19,107.21 that will pay them $2,000 per year for 20 years. They don't have the slightest idea what return they would be making on their investment of $19,107.21. What rate of return would they be earning? The annual rate of return your folks would be earning on their investment is %. (Round to two decimal places.) (Related to Checkpoint 6.1) (Loan amortization) On December 31, Beth Klemkosky bought a yacht for $80,000. She paid $18,000 down and agreed to pay the balance in 9 equal annual installments that include both the principal and 7 percent interest on the declining balance. How big will the annual payments be? a. On December 31, Beth Klemkosky bought a yacht for $80,000 and paid $18,000 down, how much does she need to borrow to purchase the yacht? (Round to the nearest dollar.) (Comprehensive problem) You would like to have $78,000 in 13 years. To accumulate this amount, you plan to deposit an equal sum in the bank each year that will earn 9 percent interest compounded annually. Your first payment will be made at the end of the year. a. How much must you deposit annually to accumulate this amount? b. If you decide to make a large lump-sum deposit today instead of the annual deposits, how large should the lump-sum deposit be? (Assume you can earn 9 percent on this deposit.) c. At the end of year 5, you will receive $10,000 and deposit it in the bank in an effort to reach your goal of $78,000 at the end of year 13. In addition to the lump-sum deposit, how much must you invest in 13 equal annual deposits to reach your goal? (Again, assume you can earn 9 percent on this deposit.) a. How much must you deposit annually to accumulate this amount? (Round to the nearest cent.)