1. In 2015, Carolyn paid $13,000 for her first year of college tuition. Carolyn’s mother Barbara started college in 1992. If tuition increased 8% per year between 1992 and 2015, how much did Barbara pay for her first year of college tuition in 1992?
2. Thomas is not too bright. He wants to have $5,000 saved up in 6 years so that he can surprise his parents with a luxurious vacation for their 50th wedding anniversary. If he invests $1,000 today as a lump sum in a bank account that compounds interest quarterly, what annual interest rate will he need in order to achieve his goal?
3. First City Bank pays 8 percent simple interest on its savings account balances, whereas Second City Bank pays 8 percent interest compounded annually. If you made a deposit of $12,500 in each bank, how much more money would you earn from your Second City Bank account at the end of 8 years?