1.A student has received a $30,000 loan from a wealthy aunt in order to finance his 4-year college program. The terms are that the student repay his aunt in full at the end of 8 years with simple interest computed at a rate of 4 percent per year. Determine the interest which must be paid on the 8-year loan.
2.A $10,000 certificate of deposit earns interest of 8 percent per year, compounded semiannually. Complete the following table with regard to semiannual compounding. What is total interest over the 2-year period?
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Semiannual
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(P)
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(I)
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(+I)
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Period
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Principal
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Interest
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Compound Amount
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1
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$10,000
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$400
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$10,400.00
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2
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