k. 1 When will the EAR equal the nominal (quoted) rate? 1. What is the value at the end of Year 3 of the following cash flow stream if interest is 4% compounded semiannually? (Hint: You can use the EAR and treat the cash flows as an ordinary annuity or use periodic rate and compound the cash flows individually.) the 0 6 Periods 0 $100 $100 $100 2. What is the PV? 3. What would be wrong with your answer to parts 1(1) and 1(2) if you used the nominal rate, 4%, rather than the EAR or the periodic rate. INOM/2 4%/2 I. Construct an amortization schedule for a $1,000, 4% annual interest loan with three equal installments. 2. What is the annual interest expense for the borrower and the annual interest income for the lender 2%, to solve the problems? m. during Year 2