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Solved by verified expert :61. Suppose
you deposited \$5,000 in a bank account that pays 5.25% with daily compounding
based on a 360-day year. How much would
be in the account after 8 months, assuming each month has 30 days?

a. \$5,178.09
b. \$5,436.99
c. \$5,708.84
d. \$5,994.28
e. \$6,294.00

62. Suppose you borrowed \$12,000 at a rate of 9.0% and must repay
it in 4 equal installments at the end of each of the next 4 years. How large would your payments be?

a. \$3,704.02
b. \$3,889.23
c. \$4,083.69
d. \$4,287.87
e. \$4,502.26

you will make a \$15,000 down payment.
You have arranged to finance the remainder with a 30-year, monthly
payment, amortized mortgage at a 6.5% nominal interest rate, with the first
payment due in one month. What will your
monthly payments be?

a. \$741.57
b. \$780.60
c. \$821.69
d. \$862.77
e. \$905.91

64. Your uncle will sell you his bicycle shop for \$250,000,
with “seller financing,” at a 6.0% nominal annual rate. The terms of the loan would require you to
make 12 equal end-of-month payments per year for 4 years, and then make an
additional final (balloon) payment of \$50,000 at the end of the last
month. What would your equal monthly
payments be?

a. \$4,029.37
b. \$4,241.44
c. \$4,464.67
d. \$4,699.66
e. \$4,947.01

65. Suppose you borrowed \$14,000 at a rate of 10.0% and must
repay it in 5 equal installments at the end of each of the next 5 years. How much interest would you have to pay in
the first year?

a. \$1,200.33
b. \$1,263.50
c. \$1,330.00
d. \$1,400.00
e. \$1,470.00

66. You plan to borrow \$35,000 at a 7.5% annual interest
rate. The terms require you to amortize
the loan with 7 equal end-of-year payments.
How much interest would you be paying in Year 2?

a. \$1,994.49
b. \$2,099.46
c. \$2,209.96
d. \$2,326.27
e. \$2,442.59:

67. Your bank offers to lend you \$100,000
at an 8.5% annual interest rate to start your new business. The terms require you to amortize the loan
with 10 equal end-of-year payments. How
much interest would you be paying in Year 2?

a. \$7,531
b. \$7,927
c. \$8,323
d. \$8,740
e. \$9,177

68. You are considering an investment in a Third World bank
account that pays a nominal annual rate of 18%, compounded monthly. If you invest \$5,000 at the beginning
of each month, how many months would it take for your account to grow to
\$250,000? Round fractional months up.

a. 23
b. 27
c. 32
d. 38
e. 44

69. You are considering investing in a bank account that pays a
nominal annual rate of 7%, compounded monthly. If you invest \$3,000 at the end of
each month, how many months will it take for your account to grow to \$150,000?

a. 39.60
b. 44.00
c. 48.40
d. 53.24
e. 58.57

70. Your child’s orthodontist offers you two alternative
payment plans. The first plan requires a
\$4,000 immediate up-front payment. The
second plan requires you to make monthly payments of \$137.41, payable at the end
of each month for 3 years. What nominal
annual interest rate is built into the monthly payment plan?

a. 12.31%
b. 12.96%
c. 13.64%
d. 14.36%
e. 15.08%

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