1. Janet plans on saving $3,000 a year and expects to earn 8.5 percent. How much will Janet have at the end of twenty-five years if she earns what she expects?
a. $236,003.38
b. $244,868.92
c. $230,702.57
d. $219,317.82
e. $256,063.66
Please show work.
2. Your great-aunt left you an inheritance in the form of a trust. The trust agreement states that you are to receive $2,000 on the first day of each year, starting immediately and continuing for fifty years. What is the value of this inheritance today if the applicable discount rate is 6.35 percent?
a. $30,557.52
b. $29,811.30
c. $32,942.42
d. $31,953.94
e. $34,006.09
Please show work.