Answer each of the following independent questions. Ignore personal income taxes.

Use Appendix A for your reference. (use approrpriate factors from tables provided).

Required:

1.Suppose you invest $4,200 in an account bearing interest at the rate 14% per year. What will be the future value of your investement in 5 years?

2. Your best friend won the state lottery and has offered to give you $11,700 in five years, after he has made his first million dollars. You figure that if you had the money today, you could invest it at 12% percent annual interest. What is the present value of your friend's future gift?

3. In four years, you would like to buy a small cabin in the mountains. You estimate that the property will cost you $69,500 when you are ready to buy. How much money would you need to invest each year in an account bearing interest at the raet of 6% per year in order to accumulate the $69,500 purchase price?

4. You have esitmated that your educational expenses over the next four years willbe $14,700 per year. How much money do you need in your account now in order to withdraw the required amount each year? Your account bears interest at 10% per year.

Future Future and Present Present Value Tables able 102 M6 Table Table III Present Value A20 21 .040 021 M20 Table IV Present a 2 250 243 6424 106 621