Lab Preparation: Time Value of Money Questions Solve and bring solutions to lab. 1. What would you pay for an investment that gives you $32.50 every six months and 1,000 after 8 years if the expected yield (discount rate) is 8% compounded semi- annually? 2. You arrange a 5 year mortgage with a 5.50% interest rate compounded semi-annually. The mortgage has an amortization period of 25 years. What is the size of your monthly mortgage payment (assuming you begin payments at the end of this month if you bought the house for $265,000 and intend to mortgage the entire amount)? 3. You have decided to lease the new Tesla when it is available. It costs $35,000 with a residual of $15,000 after 4 years and no down payment. Freight and PDI of $1,500 will also be added. The APR is 6%. What will your lease payments be? 4. You want to retire in 25 years and determine that you must have $5,000,000 to retire comfortably. How much must you save at the end of each month between now and your retirement to make this possible? Assume you are able to put the money in an account that pays 6%, compounded semi-annually. 5. You are about to start studying for exams, but instead you procrastinate by figuring out how long it will be before you get to retire. You decide that once you graduate you will get a job that pays well, and you will live at home so that you can put $25,000 per year (at the end of each year) into a retirement saving account once you begin working. That account earns 5% interest annually. If you need $5,000,000 to retire comfortably, how many years will you have to work before you have saved enough to retire