nere Question 1: a. You want to borrow money and the bank offers an annual interest rate of 8.20% compounded quarterly. What is the equivalent Effective Annual Rate (EAR)? How much would it be if it was compounded monthly? What are the practical implications of the EAR result versus the nominal one or the APR? If the rate was kept constant across all banks in the market, what would be the deciding factor in choosing where to borrow from and why? (20%) b. Two different investment opportunities are offered to you by a financial institution. Which one would you choose to invest it and why? Opportunity A: Invest in a financial instrument that will provide you with a 7.20% return per year for the same time period as investment B below (7 years). Opportunity B: Invest $20,000 today and receive $27,000 after 7 years from now. (40%) c. A fellow investor has invested $5,000 with a return of 12.20% for the next 6 years. You want to have the same profit as him/her (for the same time period) but the available investment you can choose only offers 7% return. How much money should you invest in order to have the same profit as your fellow investor? (40%)