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1. Find the PV and the FV of an investment that makes the following end-of-year payments. The interest rate is 8%. Round your answers to the nearest cent. PV of investment: $ FV of investment: \$ k. Five banks offer nominal rates of 7% on deposits, but A pays interest annually, B pays semiannually, C pays quarteriy, D pars monthly, and E pays daily. Assume 365 days in a year. 1. What effective annual rate does each bonk pay? If you deposit $5,000 in each bank today, how much will you have in each bank at the end of 1 year? 2 years? Round your answers to two decimal places. 2. If the TVM is the only consideration, what nominal rate will cause afl of the banks to provide the same effective annual rate is Bank A? Round your answers to two decimal places. 3. Suppose you don thave the $5,000 but need it at the end of 1 year. You plan to make a series of deposits - annually for A, semiannually for 0 , quarterly for C, monthly for D, and daily for E - with payments beginning today, How large must the payments be to each bank? Round your answers to the nearest cent. 4. Even if the five banks provided the same eifective annibal rate, would a rational investor be indifferent between the banks? It is more likely that an imvestor would prefer the bank that compounded frequentiy: 1. Suppose you borrow $15,000. The interest rote is 8%, and it requires 4 equal end-of-year payments. Set up an amortization schedule that shows the anhual payments, interest payments, principal repayments, and beginning and ending loan balances; Plound your answers to the nearest cent. If your answer is zero. enter " 0

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