Question 1

Find the periodic payment that will render the sum.
-FV = $24,000,interest is 8% compounded monthly,payments made at the end of each month for 3 years

Accepted Answer

A) $1264.68 
B) $7104.88 
C) $592.07 
D) $1927.72

Question 2

Find the payment necessary to amortize the loan.
-$12,800; 12% compounded monthly; 48 monthly payments

Accepted Answer

A) $1542.69 
B) $337.31 
C) $331.71 
D) $337.07

Question 3

You can afford monthly deposits of $200 into an account that pays 8% compounded monthly.How many months will it be until you have $15,000 to buy a car? (Round up to the next higher month if not an integer.)

Accepted Answer

The answer of You can afford monthly deposits of $200...

Question 4

Solve the problem. Assume that the minimum payment on a credit card is the greater of $27 or 3% of the unpaid balance.
-If the annual interest rate is 15.99%,find the difference between the minimum payment and the interest owed on an unpaid balance of $748.44 that is 1 month overdue.

Accepted Answer

A) $12.54 
B) $13.10 
C) $17.03 
D) $14.03

Question 5

Find the present value of the ordinary annuity.
-Payments of $68 made quarterly for 10 years at 8% compounded quarterly

Accepted Answer

A) $1872.41 
B) $1860.17 
C) $1829.38 
D) $667.63

Question 6

Solve the problem. Round dollar amounts to the nearest cent. Use 360 days.
-What is the purchase price of a 26-week T-bill with a maturity value of $1000 that earns an annual interest rate of 5.25%?

Accepted Answer

A) $1000 
B) $25.58 
C) $974.42 
D) $1025.58

Question 7

Solve the problem. Round to the nearest cent as needed.
-How long will it take for $8400 to grow to $14,600 at an interest rate of 9.4% if the interest is compounded continuously? Round the number of years to the nearest hundredth.

Accepted Answer

A) 0.59 year 
B) 0.06 year 
C) 5.88 years 
D) 58.81 years

Question 8

Use the future value formula to find the indicated value. Round to three decimal places.
-n = 10; i = 0.02; PMT = $1; FV = ?

Accepted Answer

A) $10.95 
B) $60.95 
C) $12.169 
D) $9.755

Question 9

Find the compound amount for the deposit. Round to the nearest cent.
-$15,000 at 10% compounded semiannually for 10 years

Accepted Answer

A) $39,799.47 
B) $24,433.42 
C) $38,906.14 
D) $30.000.00

Question 10

Find the compound interest earned. Round to the nearest cent.
-$700 at 8% compounded semiannually for 4 years

Accepted Answer

A) $252.34 
B) $595.65 
C) $258.00 
D) $118.90

Question 11

Convert the given interest rate to decimal form if it is given as a percentage, and to a percentage if it is given in decimal
form.
-11.6% to decimal

Accepted Answer

A) 11.6 
B) 116 
C) 0.116 
D) 0.00116

Question 12

Solve the problem. Round to the nearest cent as needed.
-Cara knows that she will need to buy a new car in 3 years.The car will cost $15,000 by then.How much should she invest now at 12%,compounded quarterly,so that she will have enough to buy a new car?

Accepted Answer

A) $10,520.70 
B) $12.594.29 
C) $11,957.91 
D) $9532.77

Question 13

Provide an appropriate response.
-What amount will be in an account after 1.5 years if $4,000 is invested at 5% compounded semiannually?

Accepted Answer

The answer of Provide an appropriate response.
-What amount will be...

Question 14

A $7,000 debt is to be amortized in 15 equal monthly payments of $504.87 at 1.00% interest per month on the unpaid balance.What is the unpaid balance after the second payment?

Accepted Answer

The answer of A $7,000 debt is to be amortized...

Question 15

Solve the problem. Round to the nearest cent as needed.
-An actuary for a pension fund need to have $14.6 million grow to $22 million in 6 years.What interest rate compounded annually does he need for this investment to growth as specified.Round your answer to the nearest hundredth of a percent.

Accepted Answer

A) 0.07% 
B) 7% 
C) 7.7% 
D) 7.07%

Exam 3: Mathematics of Finance

Find the periodic payment that will render the sum. -FV = $24,000,interest is 8% compounded monthly,payments made at the end of each month for 3 years

Find the payment necessary to amortize the loan. -$12,800; 12% compounded monthly; 48 monthly payments

You can afford monthly deposits of $200 into an account that pays 8% compounded monthly.How many months will it be until you have $15,000 to buy a car? (Round up to the next higher month if not an integer.)

Solve the problem. Assume that the minimum payment on a credit card is the greater of $27 or 3% of the unpaid balance. -If the annual interest rate is 15.99%,find the difference between the minimum payment and the interest owed on an unpaid balance of $748.44 that is 1 month overdue.

Find the present value of the ordinary annuity. -Payments of $68 made quarterly for 10 years at 8% compounded quarterly

Solve the problem. Round dollar amounts to the nearest cent. Use 360 days. -What is the purchase price of a 26-week T-bill with a maturity value of $1000 that earns an annual interest rate of 5.25%?

Solve the problem. Round to the nearest cent as needed. -How long will it take for $8400 to grow to $14,600 at an interest rate of 9.4% if the interest is compounded continuously? Round the number of years to the nearest hundredth.

Use the future value formula to find the indicated value. Round to three decimal places. -n = 10; i = 0.02; PMT = $1; FV = ?

Find the compound amount for the deposit. Round to the nearest cent. -$15,000 at 10% compounded semiannually for 10 years

Find the compound interest earned. Round to the nearest cent. -$700 at 8% compounded semiannually for 4 years

Convert the given interest rate to decimal form if it is given as a percentage, and to a percentage if it is given in decimal form. -11.6% to decimal

Solve the problem. Round to the nearest cent as needed. -Cara knows that she will need to buy a new car in 3 years.The car will cost $15,000 by then.How much should she invest now at 12%,compounded quarterly,so that she will have enough to buy a new car?

Provide an appropriate response. -What amount will be in an account after 1.5 years if $4,000 is invested at 5% compounded semiannually?

A $7,000 debt is to be amortized in 15 equal monthly payments of $504.87 at 1.00% interest per month on the unpaid balance.What is the unpaid balance after the second payment?

Solve the problem. Round to the nearest cent as needed. -An actuary for a pension fund need to have $14.6 million grow to $22 million in 6 years.What interest rate compounded annually does he need for this investment to growth as specified.Round your answer to the nearest hundredth of a percent.