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1. As an investor, you had a choice of daily, monthly, or quarterly compounding, which would you choose? Why?

2.Mrs. Walters will receive $8,800 a year for the next 32 years from her trust. If a 7 percent interest rate is applied, what is the current value of the future payments?

3.Carrie Tune will receive $27,500 for the next 30 years as a payment for a new song she has written. If a 10 percent rate is applied, should she be willing to sell out her future rights now for $292,000.00?

4.The Clearinghouse Sweepstakes has just informed you that you have won $800,000. You have chosen the annuity payout option and the amount is to be paid out at the rate of $20,000 a year for the next 40 years. With a discount rate of 9 percent, what is the present value of your winnings of the annuity payout option?

5. What would your investment account be worth in 20 years if you currently have $4,000 saved and plan to add $140 per month at the end of the month for the 20 years if the account pays 6% interest compounded monthly?

6.At a growth (interest) rate of 8.8 percent annually, how long will it take for you to triple your money?

7. What is the future value of an $895 annuity payment over 10 years if the interest rates are 6 percent?

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