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Q:

For a nominal interest rate of 8.4%, what is the compounding frequency if the periodic interest rate is:2.1

A) 1 B) 2
C) 3 D) 4
 
Answer & Explanation Answer: D) 4

Explanation:

i=j/m

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Q:

For a nominal interest rate of 8.4%, what is the compounding frequency if the periodic interest rate is 8.4

A) 1 B) 2
C) 3 D) 4
 
Answer & Explanation Answer: A) 1

Explanation:

m=j/i

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Q:

For a nominal interest rate of 8.4%, what is the compounding frequency if the periodic interest rate is 4.2

A) 1 B) 2
C) 3 D) 4
 
Answer & Explanation Answer: B) 2

Explanation:

i=j/m

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Q:

Calculate the periodic interest rate corresponding to 9.5% compounded monthly

A) 0.7916 B) 0.8916
C) 0.9916 D) 0.6916
 
Answer & Explanation Answer: A) 0.7916

Explanation:

i=j/m

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Q:

Calculate the periodic interest rate corresponding to:9.0% compounded quarterly

A) 3.45 B) 2.25
C) 5.25 D) 6.25
 
Answer & Explanation Answer: B) 2.25

Explanation:

i=j/m

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Q:

The periodic interest rate corresponding to: 9.75% compounded semiannually

A) 4.875 B) 3.785
C) 4.865 D) 4.975
 
Answer & Explanation Answer: A) 4.875

Explanation:

i=j/m

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Q:

A loan is made for $3500 with an interest rate of 9% and payments made annually for 4 years. What is the payment amount?

A) 8906 B) 1089
C) 1070 D) 1080.34
 
Answer & Explanation Answer: D) 1080.34

Explanation:

 

A=R[(1+i)^n-1]/i(1+i)^n

 

 

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Q:

Find the finance charge for an average daily balance of $8431.10 with monthly interest rate of 1.4%

A) 98.04 B) 88.04
C) 68.04 D) 118.04
 
Answer & Explanation Answer: D) 118.04

Explanation:

0.014*8431.10

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