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1. You want to buy a car, and a local bank will lend you $ 20,000. The loan would be fully amortized over 5 years ( 60 months), and the nominal interest rate would be 12%, with interest paid monthly. What is the monthly loan payment? What is the loan's EFF%? 2. Your parents will retire in 15 years. They currently have $ 230,000, and they think they will need $ 1 million at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds? 3. If you deposit $ 12,000 in a bank account that pays 8% interest annually, how much will be in your account after 5 years? 4. What is the present value of a security that will pay $ 85,000 in 20 years if securities of equal risk pay 4% annually? 5. Assume that 1 year from now you plan to deposit $ 1,000 in a savings account that pays a nominal rate of 8%. 6. If the bank compounds interest annually, how much will you have in your account 4 years from now? 7. What would your balance be 4 years from now if the bank used quarterly com-pounding rather than annual compounding? 8. Suppose you deposited the $ 1,000 in 4 payments of $ 250 each at the end of Years 1, 2, 3, and 4. How much would you have in your account at the end of Year 4, based on 8% annual compounding? 9. Suppose you deposited 4 equal payments in your account at the end of Years 1, 2, 3, and 4. Assuming an 8% interest rate, how large would each of your pay-ments have to be for you to obtain the same ending balance as you calculated in part a? Complete this work using MS Excel and submit 1 document as an attachment.

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