1. Mary wants to buy a house in five years. She thinks she can save $23,000 a year starting today. If she can invest the money into an account that earns 5.6% nominal interest, about how much will Mary have for a house in five years?
$128,621.70
$147,201.28
$135,824.52
2. Mike wants to buy a diesel truck which has an MSRP of $56,999. The dealer will finance the truck at 0.91% interest for 60 months. Mike thinks he can afford monthly payments of $911.00 per month. Can Mike afford the truck? Why?
Yes; the payments are exactly $911.00 per month.
Yes; the payments are than $901.80 per month.
No; the payments are $972.12 permonth.
No; the payments are $938.45 per month.