Q1. Janet Lopez wishes to establish a trust fund from which her son can withdraw $15,000 every six months for 21 years, when he reaches 25 years old. At the end of which time, he will receive the remaining money in the trust, which she would like to be $100,000. The trust will be invested at 7% per annum compounded semi-annually. How large should the trust be?

Q6. Annie recently started a new job with the Slim Tings Co. as a senior manager and is just trying to catch up on having money for retirement. Slim Tings Co. offers her a pension plan with an annuity that is guaranteed to earn 12% interest compounded annually. She plans to work for 28 years before retiring and would then like to be able to draw an income of $658,000.00 per annum for 21 years. How much must be deposited per annum into her retirement fund to accomplish this?

Q10. If you require a 12% annual return on your investments, would you prefer $20,000 six years from today or an annuity paying $1,800 at the beginning of each year for 13 years.