1. A 13-year annuity pays $3,000 per month, and payments are made at the end of each month. The interest rate is 9 percent compounded monthly for the first six years, and 7 percent compounded monthly thereafter.
What is the present value of the annuity?
2. Assume that your parents wanted to have $ 140 comma 000$140,000 saved for college by your 18th birthday and they started saving on your first birthday. They saved the same amount each year on your birthday and earned 7.5 %7.5% per year on their investments. a. How much would they have to save each year to reach their? goal? b. If they think you will take five years instead of four to graduate and decide to have $ 180 comma 000$180,000 saved just in? case, how much would they have to save each year to reach their new? goal? a. How much would they have to save each year to reach their? goal?