[5 points] The future value of an annuity due consisting of twenty-five $300 payments made

at the beginning of each month at a rate of 2.4% APR compounding monthly is (rounded

down to the nearest dollar)

[6 points] The least whole number of months it takes an investment to increase by 8% at 1.25% APR compounding quarterly is

Answer "True" or "False" for the following three parts:

Suppose you win a large amount of money in a lottery. There are two banks in which

to deposit your good fortune. Bank A pays 5.4% APR compounding semi-annually and

Bank B pays 513% APR compounding daily (1 year = 365 days). Then Bank A is the

better choice.

(ii) The maximum possible amount of compound interest that can be earned over a three

year period with 4% APR is about 12.75%.