What are the answers to these questions?

Problems designated with Excel can be solved using Excel spreadsheets accessible at http://www.prenhall.com/chatfield. 1. What is the future value of $1,000 invested for five years at the following interest rates? a. 5% b. 8% c. 10% 2. What is the future value of $1,000 invested at a 7 percent rate for the following length of time? a. 2 years b. 5 years c. 10 years 3. What is the present value of $10,000 to be received in four years at the following interest rates? a. 4% b. 7% c. 12% 4. Using an 8 percent interest rate, what is the present value of $10,000 to be received in the following number of years? a. 3 years b. 6 years c. 12 years 5. A bond issued by Fried's Restaurants pays no interest but will return $1,000 in 15 years. If you buy the bond for $326.39 today, what will be your interest rate of return on the investment? 6. If you invest $4,000 in a certificate of deposit today, a bank promises the certificate of deposit will be worth $5,000 in five years. What is your interest rate return on this investment? 7. Brewer Resorts is considering the purchase of a piece of real estate for the future site of a new project. The real estate costs $5 million. A bank has offered to finance the purchase at a 7 percent interest rate with a 10 percent down payment. The loan would be repaid with 15 equal, annual, end-ofyear payments. If Brewer borrows the $4.5 million ( 90 percent of $5 million), what is the amount of each payment? 8. Grace turned 25 years old today and would like to retire by the time of her 60 th birthday. In addition to social security and her company pension plan, she plans to invest $3,000 annually into an investment that promises to return 9 percent annually. If her first $3,000 payment is on her 26 th birthday and her last $3,000 payment is on her 60 th birthday, what will be the value of this investment on her 60 th birthday? 9. Andy wants to take out a loan to purchase a new home. He is willing to pay up to $10,000 at the end of each of the next 30 years to repay the loan. If the loan interest rate is 6 percent, what is the most he can borrow? 10. An investment costs $20,000 today and will return $3,000 at the end of each of the next 10 years. What is the interest rate of return on this investment