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A friend asks to borrow $53 from you and in return will pay you $56 in one year. If your bank is offering a 6.5% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $53 instead? b. How much money could you borrow today if you pay the bank $56 in one year? c. Should you loan the money to your friend or deposit it in the bank? Suppose you invest $1,200 in an account paying 3% interest per year. a. What is the balance in the account after 2 years? How much of this balance corresponds to "interest on interest"? b. What is the balance in the account after 34 years? How much of this balance corresponds to "interest on interest"? What is the present value of $5,000 received: a. Twenty years from today when the interest rate is 7% per year? b. Ten years from today when the interest rate is 5% per year? c. Five years from today when the interest rate is 2% per year? You are planning to invest $2,000 in an account earning 10% per year for retirement. a. If you put the $2,000 in an account at age 23 , and withdraw it 43 years later, how much will you have? b. If you wait 10 years before making the deposit, so that it stays in the account for only 33 years, how much will you have at the end