The following are several situations involving compound interest.

Required

Using the appropriate table, solve each of the following:

1. Hope Dearborn invests $40,000 on January 1, 2007 in a savings account that earns interest of 8% compounded semiannually. What will be the amount in the fund on December 31, 2012?

2. Ben Johnson receives a bonus of $5,000 each year on December 31. He starts depositing his bonus on December 31, 2007 in a savings account that earns interest of 12% compounded annually. What will be the amount in the fund on December 31, 2011 after he deposits his bonus received on that date?

3. Ron Sewert owes $30,000 on a non-interest-bearing note due January 1, 2017. He offers to pay the amount on January 1, 2007 provided that it is discounted at 10% on a compound annual discount basis. What would he have to pay on January 1, 2007 under this assumption?

4. June Stickney purchased an annuity on January 1, 2007 which, at a 12% annual rate, would yield $6,000 each June 30 and December 31 for the next six years. What was the cost of the annuity to Stickney?

5. Five equal annual contributions are to be made to a fund, the first deposit on December 31, 2007. Determine the equal contributions that, if invested at 10% compounded annually, will produce a fund of $30,000 on December 31, 2012.

6. Beginning on December 31, 2008, six equal annual withdrawals are to be made. Determine the equal annual withdrawals if $11,000 is invested at 10% interest compounded annually on December 31, 2007.