Financial Management Exam 2 Whitledge

An investment will pay you $21,000 in 7 years. The appropriate discount rate is 9 percent compounded daily. What is the present value?

$11,185.30

You want to have $60,000 in your savings account 4 years from now, and you're prepared to make equal annual deposits into the account at the end of each year. If the account pays 6.5 percent interest, what amount must you deposit each year?

$13,614.16

What is the future value of $300 in 19 years assuming an interest rate of 13 percent compounded semiannually?

$3,284.02

You are planning to make monthly deposits of $110 into a retirement account that pays 12 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 28 years?

$300,439.92

Rosina plans on saving $2,000 a year and expects to earn an annual rate of 6.9 percent. How much will she have in her account at the end of 37 years?

$313,274.38

You just obtained a loan of $16,700 with monthly payments for four years at 6.35 percent interest, compounded monthly. What is the amount of each payment?

$394.89

You estimate that you will owe $40,200 in student loans by the time you graduate. If you want to have this debt paid in full within 10 years, how much must you pay each month if the interest rate is 4.35 percent, compounded monthly?

$413.73

You just acquired a home mortgage for 30 years in the amount of $184,500 at 4.65 percent interest, compounded monthly. How much of the first payment will be interest if the loan is repaid in equal monthly payments?

$714.94

Al obtained a mortgage of $195,000 at 5.25 percent for 15 years. How much of the second monthly payment is applied to interest?

$850.00

An investment will pay you $23,000 in 9 years. The appropriate discount rate is 10 percent compounded daily. What is the present value?

$9,352.25

Your credit card company charges you 1.36 percent per month. What is the EAR on your credit card?

17.60%

What is the effective annual rate for an APR of 16.70 percent compounded monthly?

18.04%

Which one of the following compounding periods will yield the lowest effective annual rate given a stated future value at Year 5 and an annual percentage rate of 10 percent?

Annual

Your credit card charges you .85 percent interest per month. This rate when multiplied by 12 is called the ____ rate.

annual percentage