1. The current interest rates are at 8.50%. The bond you’re holding pays you $45 semi-annually for the next ten years. What is the present value of your bond, which has a maturity value of $1,000?

2. Your aunt Harriet recently inherited $100,000 and she is 75 years old. She’d like to see how much money she can take annually from the investment if it earns 8% (annually). Based upon her family genes, she thinks she will likely live to 90 years old. How much can she take from this investment annually if her estimates are correct?