Chapter 91 Compound Interest 37 CASE 9b adsheet Solutions Borrowing to Start a Business iret, a budding entrepreneur, was excited that her presentation at her college annual entrepreneurial competition was voted he best by every judge. An angel investor in the audience was very impressed by her business plan and offered to help her Sart her designer clothing store by offering her a loan at 6% compounded semi-annually. Aer two years, her business had savings of $80,654 and she used the entire amount to completely pay off her outstanding deht with the investor. a What was the loan amount provided to her by the angel investor and what was the accumulated interest over the two- year period? b What rate, compounded monthly, would have resulted in the same accumulated debt? c How long (rounded up to the next month) would it take for her debt to reach $100,000 if she does not repay any amount throughout the term? Assume the same interest rate of 6% compounded semi-annually throughout this extended period. d If she had obtained the same loan amount from a local bank, it would have accumulated to $80,654 in 18 months instead of two years. What is the interest rate compounded semi-annually charged by the local bank? e. What would her savings be if the loan had been issued to her at an annually compounding frequency? If ber contract with the investor required that she settle all dues in two years, how much could she have borrowed initially if she was sure that she could repay $25,000 in one year and $40,000 at the end of two years? &What was the size of the loan provided by the investor if she was charged 6 % compounded semi-annually for the first year, and 8% compounded quarterly for the second year and it accumulated to $80,654 in two years