You deposit today $2,000 in a bank account. How much money will you have in 8-years if your deposit earns a 4.8 % interest rate compounded monthly? 1) You buy a bond for $1,028.82 that matures in 6-years. This bond has a $1,000 par value and pays 6.2% interest in semi-annual payments. Bonds of similar risk currently yield 5.6%. Did you overpay for the bond? 2) You just won the lottery. If you acted rationally, would you prefer to receive a $105,000,000 lump-sum today or annual payments of $7,500,000 at the end of each year for the next 30-years? Assume you can earn 7.5% annually on any investments. 3) You decide to purchase preferred stock in an American Bank. The shares pay 9.25% annually on a par value of $25. Securities of similar risk pay 8.5%. If you acted rationally, what is the most you would pay for a share of this stock? 4) What interest rate would you have to earn to double your money in 10 years? 5) Your friend is a bond dealer and offers to sell you a zero-coupon bond for $1,135.62 that will pay you $1,849.80 in 10 years. What interest rate will the bond pay? 6) Conceptually understand the time value of money. 7)