QUESTION $2$

$2$ year$($s$)$ ago, Tab invested $$1,600.$ He has earned and will earn compound interest of $8\mathrm{.}50$ percent per year. If Sofa invests $$3,200$ in $4$ year$($ $ $)$ from today and

$10$ poines

earns simple interest, then how much simple interest per year must Sofa earn to have the same amount of money in $9$ year$($s$)$ from today as Tab will have in $9$ year$($s$)$ from today? Answer as an annual rate in percentage terms, rounded to the hundredth of a percent $($such as $1\mathrm{.}11\%$ or $9\mathrm{.}9996),$

$6\mathrm{.}80\%($plus or minus $0\mathrm{.}02$ percentage points$)$

None of the other alternatives are within $0\mathrm{.}02$ percentage points of the correct answer $($plus or minus $0\mathrm{.}02$ percentage points$)$

$4\mathrm{.}53\%($plus or minus $0\mathrm{.}02$ percentago points$)$

$13\mathrm{.}86\%($plus or minus $0\mathrm{.}02$ percentage points$)$

$10\mathrm{.}33\%($plus or minus $0\mathrm{.}02$ percentage points$)$

QUESTION $3$

Tab has an investment worth $$356,000.$ The Investment will make a special payment of $x$ to Tab in $4$ years from today. The investment also will make regular, fixed annual payments of $$39,000$ to Tab with the first of these payments made to Tab later today anciciche last of these annual payments made to Tab in $7$ years from today. The expected return for the investment is $7\mathrm{.}62$ percent per year. What is $x,$ the amount of the special payment that will be made to Tab in $4$ years?

Round your answer to the nearest dollar.

$$149\mathrm{.}283($plus or minus $$5\mathrm{.}00)$

$$192,947($plus or minus $$5\mathrm{.}00)$

$$176,112($plus or minus $$5\mathrm{.}00)$

None of the other alternatives are within $$5\mathrm{.}00$ of the correct answer

$$122,455($plus or minus $$5\mathrm{.}00)$

QUESTION $4$

Tab's Sofas is planning to sell its Chicago, Pittsburgh, and Buffalo stores. The firm expects to sell each of the three stores for the same, positive cash flow of $$A.$

The firm expects to sell its Pittsburgh store in S years, its Buffalo store in S years, and its Chicago store in T years. The cost of capital for the Pittsburgh store is $Y$