What is the simple interest earned

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Reference no: EM13512158

Choose the best answer for the questions below. Answers are rounded to nearest whole dollar amount.

1. What is the simple interest earned over 6 years on a principal of $55,000 at 12% interest?

a. $39,600

b. $94,600

c. $61,600

d. $58,960

2. What is the value after 4 years if $8,700 is invested in an account that pays 9% interest compounded monthly?

a. $3,300 b.$12,453 c. $9,519

d. $279,979

3. Which of the following choices of investment yields the greatest for a deposit of $20,000 over 20 years?

a. 12% simple interest

b. 10.5% compounded quarterly

c. 11.5% compounded weekly

d. 11% compounded daily

4. 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%

5. How much is the discount on a loan for which you agree to pay the lender $6,000 in one year at 8% interest?

a. $480

b. $5,520

c. $6,480

d. $960

6. You are due to receive 3 payments (one per year) which you can invest in an account that earns 9% interest per year. Which sequence of payments yields the greatest amount?

a. $200, $300, $250

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

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

Reference no: EM13512158

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