1. Assume the interest rate, r = 10% for all questions. 2. All you have to do is ?SET-UP? the problems. Do not waste time looking up factors and coming up with final answers. 3. For each question, you must indicate the time period (T?) in which you are ?setting up? the problem. Use the same approach we used in our class examples.1. Jim is a junior in high school. His parents want him to learn money and business management skills while he attends college. They plan to buy a house worth $150,000 at the end T1,so Jim can live in one bedroom and rent out the remaining bedrooms. Rent will be collected in each of the years T2 through T5. If the rent is $X in T2, the rent will be 3% higher in T3, etc. (i.e., rent increases by 3% each year). Assume rent is collected annually, at the end of each year (T2 ? T5). At the end of T5, they anticipate selling the house for $155,000. How much can Jim expect in annual rent (net of all expenses related to property upkeep, repairs due to party damages, etc.) in each of the years T2 ? T5?2. It is T0 and Joe has just sold his house for $175,000 to Flo on a land contract. Here are the terms of the contract: Flo will not make any payments in each of the years T1 ?T2. She will make a payment of $25,000 in T3; $30,000 in T4; and $35,000 in T5. She will make a final ?balloon? payment of $X at the end of T6 to settle up any remaining balance. Calculate $X.