1. Five years ago you took out a 15-year mortgage with biweekly payments (you make a payment every two weeks) to purchase your home. The interest rate is 7% per year and the biweekly payment is $800. What is the outstanding balance on the mortgage if there are 10 full years left on it? Assume there are exactly 52 weeks in a year.
2. Suppose that a young couple has just had their first baby and they wish to insure that enough money will be available to pay for their child's college education. They decide to make deposits into an educational savings account on each of their daughter's birthdays, starting with her first birthday in one year (this is year 1). Assume that the educational savings account will return a constant 9%. The parents deposit $2,400 on their daughter's first birthday and plan to increase the size of their deposits by 7% each year. Assuming that the parents have already made the deposit for their daughter's 18th birthday (this is year 18), then the amount available for the daughter's college expenses on her 18th birthday is closest to: