Please answer #1 & #2.

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2.

EAR. What is the effective annual rate (EAR) of a mortgage that is advertised at 5.25% (APR) over the next twenty years and paid with semiannual payments? What is the effective annual rate (EAR) of the mortgage at 5.25% APR with semiannual payments? \% (Round to two decimal places.) Present value with periodic rates. Sam Hinds, a local dentist, is going to remodel the dental reception area and add two new workstations. He has contacted A-Dec, and the new equipment and cabinetry will cost $22,000. The purchase will be financed with an interest rate of 7.5% loan over 9 years. What will Sam have to pay for this equipment if the loan calls for semiannual payments ( 2 per year) and monthly payments (12 per year)? Compare the annual cash outflows of the two payments. Why does the monthly payment plan have less total cash outflow each year