Write a 2 page report that answers the following questions and meet the list of requirements that follows.

Each of the problems you will be solving requires using your calculator to solve a financial equation. In order to calculate answers correctly, it is important that you follow several important rules:

1. Follow the Order of Operations to solve complicated problems.
2. Attempt to solve equations without writing down intermediate values. If you must write down values, keep as many digits or decimal places as you can. Better yet, use the memory locations in your calculator to store intermediate values.
3. NEVER round intermediate calculations. Only round the final answer.

Several excellent videos that describe how to solve algebraic expressions using the Order of Operations Rules are available at mathispower4u.yolasite.com. After reaching the Mathispower4u site, click on the Algebra 1 Video Library link and find the Order of Operations section in the first column. The first twelve short videos will give you an excellent overview. The next twelve may also be helpful.

The questions in this assignment involve calculations related to simple interest, compound interest, annuities, or mortgages. Your introduction should provide background information about these topics, describing their use and importance.

Questions:

1. Simple Interest : Steffen needed to borrow $4,000 to pay medical bills. His bank offered him a simple interest loan with an 8% annual interest rate and a 24-month term. Steffen is a wise consumer, and after checking he also learned that his credit union would offer him the same loan amount with 6% simple interest on a 3-year loan. Steffen’s loan at both institutions was structured as an installment loan.
   1. Calculate the finance charge (interest), the total installment price, and the monthly payment for the bank loan.
   2. Calculate the finance charge (interest), the total installment price, and the monthly payment for the credit union loan.
   3. Which loan is going cost Steffen more in terms of finance charge?
   4. Aside from the finance charge consideration, what other factors might influence Steffen’s choice of loan?
2. Compound Interest: Ingrid planned a month-long backpacking trip on the Pacific Crest Trail. To finance her trip, she borrowed $1,750 from her credit union, obtaining a loan with a 5% annual interest rate and monthly compounding. Ingrid paid $1,886 when payment for the loan was due. What was the term length of Ingrid’s loan?
3. Annuity Payment: Jeremy is saving money to open an indoor skate board park. He needs $10,000 in three years to purchase equipment and initiate a building lease. He’s investing his savings in an annuity yielding an annual interest rate of 6.5% compounded monthly. If the annuity requires that Jeremy make monthly investments, what annuity payment must Jeremy make to save $10,000?