You expect to have $$7,000$ in one year. A bank is offering loans at $5\%$ interest per year. How much can you borrow today?

$q,$

Today, you can borrow $ $($Round to the nearest cent.$)$

A friend asks to borrow $$45\mathrm{.}00$ from you and in retum will pay you $$48\mathrm{.}00$ in one year. If your bank is offering a $6\mathrm{.}1\%$ interest rate on deposits and loans:

a$.$ How much would you have in one year I you deposited the $$45\mathrm{.}00$ instead?

b$.$ How much money could you borrow today if you pay the bank $$48\mathrm{.}00$ in one year?

c$.$ Should you loan the money to your friend or deposit it in the bank?

The local electronics store is offering a promotion $"$t$-$year same as cash" meaning that you can buy a TV now, and wait a year to pay $($weth no interest$).$ So$,$ it you take home a $$1,000$ TV todiay, you wal owe them $$1,000$ in one year. If your bank is offering $4\mathrm{.}0\%$ interest, what is the tre cost of the TV to you fodary?

The true cost of the TV so you today is $1($Round to the nearest cent.$)$

Suppose the interest rate is $4\mathrm{.}4\%.$

a$.$ Having $$300$ today is equivalent to having what amount in one year?

b$.$ Having $$300$ hn one year is equivalent to having what amount today?

c$.$ Which would you prefer, $$300$ today or $$300$ in one year? Does your answer depend on when you need the money? Why or why not?

If your bank pays you $1\mathrm{.}5\%$ interest and you deposit $$750$ today, what will be your balance in $5$ years?

$q,$

The bank balance in $5$ years will be $ $q,($Round to the nearest cent.$)$

Calculate the future value of $$8,000$ in

a$.9$ years at an interest rate of $9\%$ per year.

b$.18$ years ot an interest rate of $9\%$ per year.

c$.9$ years at an interest rate of $18\%$ per year.

d$.$ Why is the amount of interest earned in part $($a$)$ less than half the amount of interest earned in part $($b$)?$

Your cousin is currently $11$ years old. She wit be going to college in $7$ years. Your aurt and uncle would like to have $$115,000$ in a savings account to fund ther educabon at that time. If the account promises to pay a fored interest rate of $3\mathrm{.}9\%$ per year, how much money do they need to put into the account today to ensure that they will have $$115,000$ in $7$ years?

The amount they need to put away today is $ $($Round to the nearest cent.$)$

You are planning to invest $$3,000$ in an account earning $12\%$ per year for rebirement.

a$.$ If you put the $$3,000$ in an account at age $23,$ and withdraw it $39$ years later, how much will you have?

b$.$ If you wait $10$ years before making the deposit, so that it stays in the account for only $29$ years, how much will you have at the end?