Question 1

Which is more costly: paying 11.5% simple interest for four years or paying 10% annual compounding interest for four years?

Accepted Answer

10% annual compounding

Question 2

Yvette takes out a conventional loan to purchase a car. The interest rate is 6.2% compounded monthly and Yvette has five years to repay the $9600 she borrowed. What are Yvette's monthly payments?

Accepted Answer

$186.49

Question 3

Your Great Aunt Sally loans you $1000 for seven months and asks that you repay it with simple interest at the rate of 1% per month. How much do you repay her after seven months?

Accepted Answer

$1070

Question 4

David takes out a conventional loan to purchase a car. The interest rate is 4.8% compounded quarterly and David has four years to repay the $8000 he borrowed. What are David's quarterly payments?

Accepted Answer

The answer of David takes out a conventional loan to...

Question 5

Which is more costly: paying 2.5% simple interest for a six-month loan or paying 2.4% monthly compounding interest for six months?

Accepted Answer

The answer of Which is more costly: paying 2.5% simple...

Question 6

How much would you have to invest each quarter in an annuity earning 5% quarterly to earn $5000 at the end of five years?

Accepted Answer

The answer of How much would you have to invest...

Question 7

If you borrow $10,000 for two years under the condition that no interest is charged for the first six months, and a quarterly compounded interest rate of 12% applies for the remainder of the period, how much interest will you pay?

Accepted Answer

The answer of If you borrow $10,000 for two years...

Question 8

Bill takes out a conventional loan to purchase a car. The interest rate is 5.2% compounded monthly and Bill has 10 years to repay the $15,000 he borrowed. What are Bill's monthly payments?

Accepted Answer

The answer of Bill takes out a conventional loan to...

Question 9

Find the future value of an annuity with weekly deposits of $12, made over a period of five years, with 3.8% interest compounded weekly.

Accepted Answer

The answer of Find the future value of an annuity...

Question 10

Your Great Aunt Sally loans you $1000 for two years and asks that you repay it with simple interest at the rate of 5% per year. How much do you repay her after two years?

Accepted Answer

The answer of Your Great Aunt Sally loans you $1000...

Question 11

Which is more costly: paying 12% simple interest for two years or paying 11% annual compounding interest for two years?

Accepted Answer

The answer of Which is more costly: paying 12% simple...

Question 12

Your Great Aunt Sally loans you $1000 for two years and asks that you repay it with annually compounding interest at the rate of 5% per year. How much do you repay her after two years?

Accepted Answer

The answer of Your Great Aunt Sally loans you $1000...

Question 13

Your Great Aunt Sally loans you $5000 for three years and asks that you repay it with simple interest at the rate of 8% per year. How much do you repay her after three years?

Accepted Answer

The answer of Your Great Aunt Sally loans you $5000...

Question 14

You invest $325 each quarter into an annuity earning 9% compounded quarterly. How much do you have at the end of 10 years?

Accepted Answer

The answer of You invest $325 each quarter into an...

Question 15

David takes out a conventional loan to purchase a car. The interest rate is 4.8% compounded quarterly and David has four years to repay the $12,000 he borrowed. What are David's quarterly payments?

Accepted Answer

The answer of David takes out a conventional loan to...

Question 16

If you borrow $10,000 for three years at a quarterly compounding interest rate of 4% per year, how much interest will you pay?

Accepted Answer

The answer of If you borrow $10,000 for three years...

Question 17

If you borrow $50,000 for three months at a monthly compounding rate of 18% per year, how much interest will you pay?

Accepted Answer

The answer of If you borrow $50,000 for three months...

Question 18

Your Great Aunt Sally loans you $1000 for seven months and asks that you repay it with monthly compounding interest at the rate of 1% per month. How much do you repay her after seven months?

Accepted Answer

The answer of Your Great Aunt Sally loans you $1000...

Question 19

Your Great Aunt Sally loans you $5000 for three years and asks that you repay it with annually compounding interest at the rate of 8% per year. How much do you repay her after three years?

Accepted Answer

The answer of Your Great Aunt Sally loans you $5000...

Question 20

How much would you have to invest each month in an annuity earning 6% monthly to earn $50,000 at the end of 30 years?

Accepted Answer

The answer of How much would you have to invest...

Quiz 22: Borrowing Models

Which is more costly: paying 11.5% simple interest for four years or paying 10% annual compounding interest for four years?

Yvette takes out a conventional loan to purchase a car. The interest rate is 6.2% compounded monthly and Yvette has five years to repay the $9600 she borrowed. What are Yvette's monthly payments?

Your Great Aunt Sally loans you $1000 for seven months and asks that you repay it with simple interest at the rate of 1% per month. How much do you repay her after seven months?

David takes out a conventional loan to purchase a car. The interest rate is 4.8% compounded quarterly and David has four years to repay the $8000 he borrowed. What are David's quarterly payments?

Which is more costly: paying 2.5% simple interest for a six-month loan or paying 2.4% monthly compounding interest for six months?

How much would you have to invest each quarter in an annuity earning 5% quarterly to earn $5000 at the end of five years?

If you borrow $10,000 for two years under the condition that no interest is charged for the first six months, and a quarterly compounded interest rate of 12% applies for the remainder of the period, how much interest will you pay?

Bill takes out a conventional loan to purchase a car. The interest rate is 5.2% compounded monthly and Bill has 10 years to repay the $15,000 he borrowed. What are Bill's monthly payments?

Find the future value of an annuity with weekly deposits of $12, made over a period of five years, with 3.8% interest compounded weekly.

Your Great Aunt Sally loans you $1000 for two years and asks that you repay it with simple interest at the rate of 5% per year. How much do you repay her after two years?

Which is more costly: paying 12% simple interest for two years or paying 11% annual compounding interest for two years?

Your Great Aunt Sally loans you $1000 for two years and asks that you repay it with annually compounding interest at the rate of 5% per year. How much do you repay her after two years?

Your Great Aunt Sally loans you $5000 for three years and asks that you repay it with simple interest at the rate of 8% per year. How much do you repay her after three years?

You invest $325 each quarter into an annuity earning 9% compounded quarterly. How much do you have at the end of 10 years?

David takes out a conventional loan to purchase a car. The interest rate is 4.8% compounded quarterly and David has four years to repay the $12,000 he borrowed. What are David's quarterly payments?

If you borrow $10,000 for three years at a quarterly compounding interest rate of 4% per year, how much interest will you pay?

If you borrow $50,000 for three months at a monthly compounding rate of 18% per year, how much interest will you pay?

Your Great Aunt Sally loans you $1000 for seven months and asks that you repay it with monthly compounding interest at the rate of 1% per month. How much do you repay her after seven months?

Your Great Aunt Sally loans you $5000 for three years and asks that you repay it with annually compounding interest at the rate of 8% per year. How much do you repay her after three years?

How much would you have to invest each month in an annuity earning 6% monthly to earn $50,000 at the end of 30 years?