A friend asks to borrow $55 from you and in return will pay you $58 in one year. Ifyour bank is offering a 6% interest rate on deposits and loans: How much would you have in one year if you deposited...

A friend asks to borrow $55 from you and in return will pay you $58 in one year. Ifyour bank is offering a 6% interest rate on deposits and loans:

1. How much would you have in one year if you deposited the $55 instead?


2. How much money could you borrow today if you pay the bank $58 in one year?


3. Should you loan the money to your friend or deposit it in the bank?