Question
Q1.Five years ago, Jane invested $3,080 and locked in a(n) 5.2% annual interest rate for 25 years (end 20 years from now). James can make
Q1.Five years ago, Jane invested $3,080 and locked in a(n) 5.2% annual interest rate for 25 years (end 20 years from now). James can make a 20-year investment today and lock in a(n) 10% interest rate. How much money should he invest now in order to have the same amount of money in 20 years as Jane? (Round your final answer to two decimal places.)
Q2. Your firm receives an offer from the supplier who provides computer chips used to manufacture cell phones. Due to poor planning, the supplier has an excess amount of chips and is willing to sell $688,779 worth of chips for only $418,254. You already have 4 years' supply on hand. It would cost you $9,079 today to store the chips until your firm needs them in 4 years. What implied interest rate would you be earning if you purchased and store the chips? (Round your final answer to two decimal places and report in percentage form: x.xx%)
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