# PART 1. Create a 600-750 word report, and include the following: Describe the r

PART 1. Create a 600-750 word report, and include the following: Describe the role of the financial institutions and financial markets in our economy Differentiate between primary and secondary markets. Differentiate between money and capital markets. Format your assignment consistent with APA guidelines. PART 2. Problem sets Problem Set – Time Value of Money Show all calculations – you can’t receive partial credit if I don’t know how you tried to solve the problem. 1What is the future value at the end of year 8 of a $1,400 deposit at the beginning of year 1 and another $900 deposit at the beginning of year 5 if the interest rate is 5%? 2What is the present value of a $1,300 deposit at the end of year 1 and another $600 deposit at the end of year 5 if the interest rate is 7%? 3Given a 4 percent interest rate, compute the future value at the end of year 6 of deposits of $1,100, $1,200, $1,300, and $1,400 made at the beginning of years 1, 2, 3, and 4. 4What is the future value of an ordinary annuity with $850 payments over 8 years if the interest rate is 5%? 5What is the present value of an ordinary annuity with $850 payments over 8 years if the interest rate is 5%? 6If the present value of an ordinary, 6-year annuity is $11,000 and the interest rate is 4.5 percent, what’s the present value of a annuity due with the same terms? 7Assume that you contribute $100 per month to a retirement plan for 10 years. Then you are able to increase the contribution to $300 per month for the next 30 years. Given a 6 percent interest rate, what is the value of your retirement plan after the 40 years? 8You wish to borrow $18,000 to buy a car. The dealer offers you a 4-year loan with a 3.5 percent APR. What is the monthly payment? 9For the loan in Question #8, how would the payment differ if you paid interest only? What would happen when the loan matures at the end of year 4?