1. CanAm Financial offers investments that pay 12 percent interest compounded monthly, whereas UniMex Financial offers investments that pay 12.25 percent interest compounded semiannually. Which investment offers the better effective annual return?
2. William recently graduated from NFA University. While at NFA, William took out a $50,000 student loan. His loan requires him to make monthly payments for a 10-year period. (a) If the simple annual interest is 4.2 percent, what are William's monthly payments? (b) to the nearest dollar, how much will William owe on his student loan after he makes payments for three years?
3. Nona purchased a new car earlier today for $32,000. She financed the entire amount using a five-year loan with a 3 percent interest rate (compounded monthly). (a) Compute the monthly payment for the loan. (b) How much will Nona owe on the loan after she makes payments for two years (i.e., after 24 payments)?