Solve all questions by showing the formulas.

8-You are 25 years old and inherit $65,000 from your grandmother. If you wish to purchase a $100,000 boat to celebrate your 30th birthday, what compound annual rate of return must you earn?

9- An investment offers to pay you $10,000 a year for five years. If it costs $33,520, what will be your rate of return on the investment?

10-An investment costs $61,446 and offers a return of 10 percent annually for ten years. What are the annual cash inflows anticipated from this investment?

11-You have an IRA worth $200,000 and want to start to make equal, annual withdrawals (that is, distributions from the account) for 20 years. You anticipate earning 5 percent on the funds. How much can you withdraw each year?

12-If a corporation promises to pay you $60 a year for three years and $1,000 after three years, what is the maximum amount you would lend if you wanted to earn 8 percent?

13- If a firm has $12,400 to invest and can earn 14 percent, how much will the firm have after two years?

14- Your real estate agent mentions that homes in your price range require a payment of

approximately $1,200 per month over 30 years at 9% interest. What is the approximate size of

the mortgage with these terms?

15- What is the future value of $100 to be deposited today into an account paying 8%,

compounded semiannually for 2 years? How will your answer change if it compounds quarterly?