You are the manager of a bank. You need to decide whether to approve a 10-year loan application from a 25 year old student to finance her MBA. The loan will yield a loss of $250 per year to the bank for the duration of the loan. After 10 years, the student will likely buy other products and therefore she will yield a profit of $500 per year until she is 65. After age 65, she will yield a profit of $1,000 per year until she is 85, when she will stop being a customer. The likelihood that she stops being a customer after she repays her MBA loan is 2% each year. The discount rate that the bank uses is 7% per year. Would you approve the loan? Please explain with numerical support.

5. understanding marginal and average tax rates consider the economy of citronia, where citizens consume only oranges. assume that oranges are priced at $1 each. the government has devised the following tax plans: plan a • consumption up to 1,000 oranges is taxed at 50%. • consumption higher than 1,000 oranges is taxed at 20%. plan b • consumption up to 2,000 oranges is taxed at 15%. • consumption higher than 2,000 oranges is taxed at 60%. use the plan a and plan b tax schemes to complete the following table by deriving the marginal and average tax rates under each tax plan at the consumption levels of 300 oranges, 1,200 oranges, and 3,000 oranges, respectively. consumption level plan a plan b (quantity of oranges) marginal tax rate average tax rate marginal tax rate average tax rate (percent) (percent) (percent) (percent) 300 1,200 3,000 complete the following table by indicating whether each plan is a progressive tax system, a proportional tax system, or a regressive tax system. progressive proportional regressive plan a plan b