1. You invest $2,800 in a 4-year certificate of deposit (CD) that pays 3.6% interest, compounded annually. How much money will you have when the CD matures?
2. You've just deposited $9,000 in a savings account to save for a new car that you want to buy in 4 years. How much money will you have in 4 years if the interest rate is 5%?
3. The annual interest rate is 6%. What is the present value (PV) of $1,000 that you'll receive in 15 years?
4. You know that you'll inherit $30,000 in 17 years. If you borrow $4,000 now and plan to pay it off with the money you'll inherit, what is the highest annual interest rate you can afford on the loan?
5. Your bank offers an interest rate of 8% per year. How long does it take you to double your money?
6. You invest $2,000 per year for 20 years into an account that earns 12% annually. A. How much will you have in 20 years? B. Calculate this as an annuity due.
7. You are offered the following as a settlement: $50,000 per year for 15 years or $500,000 today. Assuming an interest rate of 6%, which should you take?
8. You are offered the following cash flows by your company upon retirement:

Year Amount

1. $50,000
2. 60,000
3. 70,000
4. 80,000
5. 90,000

You are offered a payment today of $270,000 in place of the payments above. Assuming a 7% interest rate, which should you take?