1. An investor age 35 deposits \$10000 in a fund earning 7% compound interest until retirement at age 65. Find the amount of interest earned (calculations by hand) :
1. Between ages 35 and 45
2. Between ages 45 and 55
3. Between ages 55 and 65
2. Jim loans 10000\$ to Amenda immediately, 5000\$ in 3 years and 1000\$ in 4 years. Amenda repays Jim with two equal payments of Y \$; one payment of Y at the end of the fifth year and one payment of Y at the end of the sixth year, assuming a nominal interest rate of 6%, compounded monthly.

(a) Draw a time diagram of the cash flows.

0                     1                     2                     3                     4                     5                     6

(b) Evaluate Y .

1. Billy contracted a loan at the bank. He pays back his loan in 3 payments : the first one is \$7000 made after one year, the second one of \$5000 made one year and a half after he contracted the loan, and the last one, of \$3000, made two years after he contracted the loan. The interest rate is i(2) = 10%. (Do not insert code in your answers)

(a) Determine the amount of the loan.

(b) If after his first payment of \$7000, Billy renegotiates his loan with the bank such that he only has one payment left of \$X to do, four years after he contracted the loan, with the same interest rate, what should be the value of X ?

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