MTH1053 Section 5.1-5.4 Group Class Activity 6 Complete the problems below with your group and turn it in on Friday. Problem 1 (Section 5.1). Suppose that $1000 is misplaced in a non-interest-bearing checking account and forgotten. Each year, the bank imposes a service charge of 1%. After 20 years, how much remains of the $1000? (Hint: use the compound interest formula with r = -0.01.) Problem 2 (Section 5.2). Alen owes Bill two sums of money: $1000 plus interest at 7% compounded annually, which is due in five years, and $2000 plus interest at 8% compounded semiannually which is due in 7 years. If both payments are to be paid off by a single payment at the end of six years, find the amount of the payment if money is worth 6% compounded quarterly. Problem 3 (Section 5.3). If interest is compounded continuously at an annual rate of 3%, in how many years will a principal double? Problem 4 (Section 5.4). A machine is purchased for $3,000 down and payments of $250 at the end of every six months for six years. If interest is at 8% compounded semiannually, find the corresponding cash price of the machine