You just received a bonus of

$1,000.

a.Calculate the future value of

$1,000,

given that it will be held in the bank for

9

years and earn an annual interest rate of

6

percent.

b.Recalculate part

(a)

using a compounding period that is (1) semiannual and (2) bimonthly.

c.Recalculate parts

(a)

and

(b)

using an annual interest rate of

12

percent.

d.Recalculate part

(a)

using a time horizon of

18

years at an annual interest rate of

6

percent.

e.What conclusions can you draw when you compare the answers in parts

(c)

and

(d)

with the answers in parts

(a)

and

(b)?