Finite Math
Week
4Quiz –FinancialTopics Foreachsectionreadthedirectionsanddeterminethebes
tanswer Choo
se the best answer for the ques
tions below.
Ans
wers are roun
ded
to nea
rest whole dollar amount. 1. What i
s the simple interest ear
ned
ove
r 6 yea
rs on a principal of $55
,000
at 12% interest? a. $39,600
b. $94,600
c. $61,600 d. $58,960 3. What is the value after 4 year
s if $8,700 is inves
ted in an accoun
t that pay
s 9% interest compounded
monthly?
a. $3,300
b.$12
,453
c. $9,519
d. $279
,979
5. Which of the following choices of investment yields the greatest for a depos
it
of $20
,000 over 20 years? a. 12% simple interest b. 10.5% compounded qua
rterly c. 11.5% compounded weekly d. 11% compounded daily
2. What is the effectiverateofinterest for a one
year loan
of $3,000 given at 15% interest if the interest is compounded quarterly?
a. 15.24% b. 15.27% c. 15.87% d. 15.94%
4. How much
is the discoun
t on a loan for which you
agree to pay the lende
r $6,000 in one year at 8% interest? a. $480
b. $5,520 c. $6,480 d. $960
6. You
are due
to rece
ive 3 payments (one per year) which you can
invest in an account that earns 9% interest per year. Which sequ
ence of payments yields the greatest amount?
a. $200, $300, $25
0 b. $250, $100, $300 c. $400, $100, $100 d. $300, $200, $250 7. Compute the monthly loan payment required to pay off $150
,000 dollars at 7% interest over 15 years. (
Note: a monthly payment means
the interest is compounded monthly) a. $1,348
.24 b. $427
,342
.01 c. $2,374
.12 d. $16
,084
.35 Finite Math
Week 4 Quiz –Financial Topics
8. How much money should be invested in an account that earns 9% interest, compounded monthly, if you want to have $500,000 after 20 years?
a. $45
,600.00 b. $83
,206
.42
c. $41
,603
.21
d. $430
,594
.93
9. What is the value of an annuity if $250 dollars is deposited monthly for 7 years at 12% interest?
a. $1,803
.38 b. $32
,668
.07 c. $113
,527
.42 d. $52
,098
.73
10. How much would you need to deposit if you wanted to withdrawal $750 a month for 3 years if a bank will pay 8% interest?
a. $25,000.00 b. $18
,781
.22
c. $23
,933
.85
d. $31
,060
.74