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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 $4800 with an APR of 12% and payments made monthly for 24 months. What is the payment amount? What is the finance charge?

A) 622.80	B) 522.80
C) 322.80	D) 632.80

Answer & Explanation Answer: A) 622.80

Explanation:

${\color{Blue} A=R\left [(1+i)^{n-1} \right ]/i ( 1+i )^{n}}$

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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:

A retirement benefit of $12,000 is to be paid every 6 months for 25 years at interest rate of 7% compounded semi-annually. Find

(a) the present value to fund the end-of-period retirement benefit.

(b) the end-of-period semi-annual payment needed to accumulate the value in part (a) assuming regular investments for 30 years in an account yielding 8% compounded semi-annually

A) 245678	B) 234689
C) 281468.06	D) 234578

Answer & Explanation Answer: C) 281468.06

Explanation:

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

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Q:

15 semiannual payments are made into a sinking fund at 7% compounded semiannually so that $4850 will be present. Find the amount of each payment rounded to the nearest cent

A) 251.35	B) 245.45
C) 235.87	D) 251

Answer & Explanation Answer: A) 251.35

Explanation:

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

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Q:

Kashundra Jones plans to make a lump sum deposit so that she can withdraw $3,000 at the end of each quarter for 10 years. Find the lump sum if the money earns 10% per year compounded quarterly

A) 75263.64	B) 76345
C) 76389	D) 56897

Answer & Explanation Answer: A) 75263.64

Explanation:

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

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Q:

What lump sum deposited today would allow payments of $2000/year for 7 years at 5% compounded annually?

A) 11572.71	B) 11876
C) 189756	D) 11576

Answer & Explanation Answer: A) 11572.71

Explanation:

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

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Q:

Sharon Stone deposits $500 at the beginning of each 3 months in an account earning 10% compounded quarterly. Determine how much money she has after 25 years

A) 22681.19	B) 23456
C) 44577	D) 25685

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