Questions
1 You are offered an investment that will make three payments. The first payment
of $5,600 will occur four years from today. The second of $6,700 will occur in
five years, and the third of $7,800 will follow in seven years. If you can earn
9.1% percent, what is the most this investment is worth today?
2 A bank is offering 11.1% percent compounded quarterly. If you put $110 per
quarterly at the end of each quarter in an account, how much will you have at
the end of 5 year?
3 A bank is offering 9.8% percent compounded weekly. What is the effective
annual rate (EAR)?
4 You have just purchased a new warehouse. To finance the purchase, you've
arraigned for a 30-year mortgage loan for 80 percent of the $2,700,000 purchase
price. The monthly payment on this loan will be $13,600. What is the APR on
this loan?
Answers