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1) Your spouse needs a car and you believe you can afford no more than $350 a month for a 5-year car loan. If the interest rate on this loan is 5% percent, what is the maximum you can afford to borrow to purchase this car?
2) Your employer contributes $100 a week to your retirement plan. Assume that you work for this employer for another 15 years and the applicable discount rate is 7.25%. Given these assumptions, what is this employee benefit worth to you today?
3) You anticipate saving $1,800 a year for each of the next 25 years and anticipate earning 7% interest per year. Assuming annual compounding, how much do you expect to have in your account after 25 years?
4) You are borrowing $19,500 to buy a car. The terms of the loan call for monthly payments for 5 years at 6% percent interest. What is the amount of each monthly payment?