Question: Please answer these questions. 1. Sam has a choice between two bank loans. Loan A has an annual percentage rate of 7.55 percent butwith interest

Please answer these questions.

1. Sam has a choice between two bank loans. Loan A has an annual percentage rate of 7.55 percent butwith interest compounded monthly. Loan B has an annual percentage rate of 7.45 percent with interest compounded daily. Which loan should Sam select?

2. Suppose you have just started with your career and got your dream job with a salary of $200,000 per year. You are now aspire to buy a house but do not want to get a bank loan. The average price of your dream house is $500,000 today and its price is growing at 5 percent per year. How much should you invest in a project at the end of each year for the next 5 years in order to accumulate enough money to buy that house with cash at the end of the fifth year? Assume the project pays 12 percent rate of return.

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