Chapter 5.3, Problem 37E

Anne Geyer buys some land in Utah. She agrees to pay the seller a lump sum of $\$65,000$ in five years. Until then, she will make monthly simple interest payments to the seller at $11\%$ interest.

a. Find the amount of each interest payment.

b. Anne sets up a sinking fund to save the $\$65,000$. Find the size of her semiannual payments if her payments are due at the end of every six-month period and her money earns $8\frac{3}{8}\%$ interest.

c. Prepare a table showing the amount in the sinking fund after each deposit.