1. Your parents are giving you $100 a month for four years while you are in college. At a percent discount rate, what are these payments worth to you when you first start college? 2. You need some money today and the only friend you have that has any is your ‘miserly’ friend. He agrees to loan you the money you need if you make payments of $20 a month for the next six months. In keeping with his reputation, he requires that the first payment be paid today. He also charges you 1.5 percent interest per month. How much money are you borrowing?

3.Janet plans on saving $3,000 a year and expects to earn 8.5 percent. How much will Janet have at the end of twenty-five years if she earns what she expects?