1. Your supervisor has tasked you with evaluating several loans related to a new expansion project. Using the PVIFA table (table 9.4 in the textbook), determine the annual payment on a $179,000, 6% business loan from a commercial bank that is to be amortized over a five-year period. Show your work. Does this payment seem reasonable? Explain.

2. Dan is considering borrowing $359,000 to purchase a new condo. Based on that information, answer the following questions. Show all work. a)Calculate the monthly payment needed to amortize a 3.5% fixed-rate 30-year mortgage loan. b)Calculate the monthly amortization payment if the loan in (a.) was for 15 years instead. c)In a few sentences, explain the effect of a smaller loan period. How does it influence the monthly payment and interest?

3 Use a financial calculator or computer software program to answer the following questions: a)Melanie is trying to save money for retirement and has a future goal of $750,000 at the end of 20 years. Determine the present value of her goal using a discount rate of 17.5%. b)How would the present value change if the $750,000 is to be received at the end of 15 years instead? Explain the impact and show your work?

4. Your friend Anne is planning to invest $550 each year for five years and will earn a rate of 8.5 percent per year. a)Determine the future value of this annuity due if her first $550 is invested now. Show your work. b)What is the difference between an annuity due and an ordinary annuity? Explain.

5. Jimmy has a bond with a $1,000 face value and a coupon rate of 8.5% paid semiannually. It has a six-year life. a)If investors are willing to accept a 7.5 percent rate of return on bonds of similar quality, what is the present value or worth of this bond? Show your work. b)What is the impact of paying interest semi-annually rather than annually? Explain.