Problem:
After graduation, you plan to work for Mega Corporation for 10 years and then start your own business. You expect to save $5,000 a year for the first 5 years and $10,000 annually for the following 5 years, with the first deposit being made a year from today. In addition, your grandfather just gave you a $10,000 graduation gift which you will deposit immediately. If the account earns 8% compounded annually, what how much will you have when you start your business 10 years from now?
A 30-year, $115,000 mortgage has a nominal annual rate of 7%. All payments are made at the end of each month.
1) What is the monthly payment on the mortgage?
2) What is the remaining balance on the mortgage after 5 years?
3) How much of your 2nd monthly payment will go toward the repayment of principal?