1. Suppose a State of New Mexico bond will pay $1,000 eight years from now. If the going interest rate on these 20-year bonds is 5.5%, how much is the bond worth today?
2. Ellen now has $125. How much would she have after 8 years if she leaves it invested at 9% with annual compounding?
3. You would like to travel to South America 10 years from now, and you can save $100 weekly, beginning immediately. You plan to deposit the funds in a mutual fund that you think will return 8.5% per year. Assuming 52-week a year, how much would you have 10 years from now?