John and Mary are a young couple, who want to put their finance in order. Both the husband and the wife are 27 years old and in stable employment. They want to manage their savings and earning to achieve a better return and reduce the risks. You want to help them in their financial planning by answering a series of questions as follows:

a. The great Albert Einstein once said Compound interest is the eighth wonder of the world. He who understands it, earns it he who doesnt pays it. What is the future value of an initial $500 after 30 years if it is invested in an account paying 15 percent annual interest? What is the present value of $1000000 to be received in 15 years if the appropriate interest rate is 12 percent?

b. What is the difference between an ordinary annuity and an annuity due? What are the future value and present value of a five-year ordinary annuity of $1000 if the appropriate interest rate is 10 percent? What would the future and present values be if the annuity were an annuity due?

PLEASE ANSWER BOTH A, B