1. Assume you borrow $10,000 today and promise to repay the loan in two payments, one in year 2 and the other in year 4, with the one in year 4 being only half as large as the one in year 2. At an interest rate of 10% per year, the size of the payment in year 4 will be closest to:
a. $4280
b. $3975
c. $3850
d. $2335
2. An engineer planning for retirement decides that she wants to have income of $100,000 peryear for 20 years with the first withdrawal beginning 30 years from now. If her retirement account earns interest at 8% per year, the annual amount she would have to deposit for 29 years beginning 1 year from now is closest to:
a. $7360
b. $8125
c. $8670
d. $9445