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Compute the future and/or present values of the following. Each should be treated as a separate situation:

1. On January 2, 2020, Jensen Company borrowed $150,000 from Lyon Country Bank. The terms of the loan

agreement specified 4 equal annual payments at 6% annual interest. Compute the amount of each of these

payments, assuming they begin on December 31, 2020.

2. If $12,000 is deposited annually starting on January 1, 2020 and it earns 9%, how much will accumulate by

December 31, 2029?

3. Steve Milner borrowed $120,000 on July 1, 2020. This amount plus accrued interest at 8% compounded

semiannually is to be repaid in total on July 1, 2030. To retire this debt, Milner plans to contribute to a debt

retirement fund five equal amounts starting on July 1, 2025 and continuing for the next four years. The fund

is expected to earn 6% per annum. Compute how much must be contributed each year by Steve Milner to provide a fund sufficient to

retire the debt on July 1, 2030?

4. Andrea is 40 years old today and she wishes to accumulate $2,000,000 by her sixty fifth birthday so she

can retire to a beach in Florida. She wishes to accumulate this amount by making equal deposits on her

fortieth through her sixty fourth birthdays. Compute the annual deposit Andrea must make if the fund will

earn 6% interest compounded annually.

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