Question 1

Tricia bought a living-room suite on credit, signing an installment contract with a finance company that requires monthly payments of $167.25 for 4.5 years. The first payment is made on the date of signing and interest is 28.8% compounded monthly.
a)What was the cash price?
b)How much will Tricia pay in total?
c)How much of what she pays will be interest?

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Question 2

A sum of money is deposited at the beginning of each year for 3 years at 12% compounded annually. After the last deposit interest for the account is to be 8.24% compounded quarterly and the account is to be paid out by payments of $370.00, made at the beginning of each quarter for nine years. What is the size of the annual deposit?

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Question 3

Vicki paid for a kitchen set over time, signing an installment contract that requires semi-annual payments of $500.00 for 5 years. The first payment is made on the signing date and interest is 18% compounded semi-annually. What was the cash price?

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Question 4

How much does a depositor have to save at the beginning of every three months for 13.25 years to accumulate $41 600.00 if interest is 8% compounded quarterly?

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Question 5

A contract valued at $81 500.00 requires payment of $3350.00 at the beginning of every six months. If interest is 6.5% compounded semi-annually, what is the term of the contract?

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Question 6

Sean Paul makes deposits of $500.00 at the beginning of every three months. Interest earned by the deposits is 8% compounded quarterly.
a)What will the balance in Sean's account be after ten years?
b)How much of the balance will Sean have contributed?
c)How much of the balance is interest?

Accepted Answer

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Question 7

Jack Chen makes deposits of $415.00 at the beginning of every three months. Interest earned by the deposits is 4.12% compounded quarterly.
a)What will the balance in Jack's account be after eight years?
b)How much of the balance will Jack have contributed?
c)How much of the balance is interest?

Accepted Answer

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Question 8

How much does a depositor have to save at the beginning of every 6 months for eleven years to accumulate $17 448.00 if interest is 6.25% compounded semi-annually?

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Question 9

Equal sums of money are withdrawn monthly from a fund of $33 000.00 for 15.25 years. If interest is 9% compounded monthly, what is the size of each withdrawal if the withdrawal is made at the beginning of each month?

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Question 10

Robert Bernard deposited $1000.00 in a trust account on the day of his son's birth and every three months thereafter. If interest paid is 8% compounded quarterly, what will the balance in the trust account be before the deposit is made on the son's twenty-first birthday?

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Question 11

Kelly is saving $1600.00 at the beginning of each month. How soon can he retire if he wants to have a retirement fund of $345 000.00 and interest is 11.04% compounded monthly?

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Question 12

How many months will it take to accumulate $17 897.20 at 5.87% compounded semi-annually, if $1140.00 is deposited in an account at the beginning of every 6 months?

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Question 13

What deposit made at the beginning of each month will accumulate to $36 000.00 at 5% compounded quarterly at the end of eight years?

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Question 14

Equal sums of money are withdrawn monthly from a fund of $60 000.00 for 15 years. If interest is 12% compounded monthly, what is the size of each withdrawal if the withdrawal is made at the beginning of each month?

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Question 15

Determine the future value and the present value of monthly payments of $200.00 each for five years at 12% compounded monthly if
a)the payments form an annuity due;
b)the payments form an ordinary annuity.

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Question 16

Gibran bought a boat valued at $110 194.00 on the installment plan. He made equal semi-annual payments for 6 years. If the first payment is due on the date of purchase and interest is 7.5% compounded semi-annually, what is the size of the semi-annual payments?

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Question 17

How much does a depositor have to save at the beginning of every 6 months for twenty years to accumulate $1 000 000.00 if interest is 6.00% compounded semi-annually?

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Question 18

Determine the future value and the present value of monthly payments of $173.00 each for six years at 6.48% compounded monthly if
a)the payments form an annuity due;
b)the payments form an ordinary annuity.

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The answer of Determine the future value and the present...

Question 19

What is the accumulated value after 15 years of monthly deposits of $500.00 earning interest at 8% compounded semi-annually if the deposits are made
a)at the end of each month?
b)at the beginning of each month?

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Question 20

A lease requires payments of $1200.00 at the beginning of every quarter for ten years. If interest is 6% compounded monthly, calculate the value of the lease.

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Quiz 13: Annuities Due, Deferred Annuities, and Perpetuities

Vicki paid for a kitchen set over time, signing an installment contract that requires semi-annual payments of $500.00 for 5 years. The first payment is made on the signing date and interest is 18% compounded semi-annually. What was the cash price?

How much does a depositor have to save at the beginning of every three months for 13.25 years to accumulate $41 600.00 if interest is 8% compounded quarterly?

A contract valued at $81 500.00 requires payment of $3350.00 at the beginning of every six months. If interest is 6.5% compounded semi-annually, what is the term of the contract?

Sean Paul makes deposits of $500.00 at the beginning of every three months. Interest earned by the deposits is 8% compounded quarterly. a)What will the balance in Sean's account be after ten years? b)How much of the balance will Sean have contributed? c)How much of the balance is interest?

Jack Chen makes deposits of $415.00 at the beginning of every three months. Interest earned by the deposits is 4.12% compounded quarterly. a)What will the balance in Jack's account be after eight years? b)How much of the balance will Jack have contributed? c)How much of the balance is interest?

How much does a depositor have to save at the beginning of every 6 months for eleven years to accumulate $17 448.00 if interest is 6.25% compounded semi-annually?

Equal sums of money are withdrawn monthly from a fund of $33 000.00 for 15.25 years. If interest is 9% compounded monthly, what is the size of each withdrawal if the withdrawal is made at the beginning of each month?

Robert Bernard deposited $1000.00 in a trust account on the day of his son's birth and every three months thereafter. If interest paid is 8% compounded quarterly, what will the balance in the trust account be before the deposit is made on the son's twenty-first birthday?

Kelly is saving $1600.00 at the beginning of each month. How soon can he retire if he wants to have a retirement fund of $345 000.00 and interest is 11.04% compounded monthly?

How many months will it take to accumulate $17 897.20 at 5.87% compounded semi-annually, if $1140.00 is deposited in an account at the beginning of every 6 months?

What deposit made at the beginning of each month will accumulate to $36 000.00 at 5% compounded quarterly at the end of eight years?

Equal sums of money are withdrawn monthly from a fund of $60 000.00 for 15 years. If interest is 12% compounded monthly, what is the size of each withdrawal if the withdrawal is made at the beginning of each month?

Determine the future value and the present value of monthly payments of $200.00 each for five years at 12% compounded monthly if a)the payments form an annuity due; b)the payments form an ordinary annuity.

Gibran bought a boat valued at $110 194.00 on the installment plan. He made equal semi-annual payments for 6 years. If the first payment is due on the date of purchase and interest is 7.5% compounded semi-annually, what is the size of the semi-annual payments?

How much does a depositor have to save at the beginning of every 6 months for twenty years to accumulate $1 000 000.00 if interest is 6.00% compounded semi-annually?

Determine the future value and the present value of monthly payments of $173.00 each for six years at 6.48% compounded monthly if a)the payments form an annuity due; b)the payments form an ordinary annuity.

What is the accumulated value after 15 years of monthly deposits of $500.00 earning interest at 8% compounded semi-annually if the deposits are made a)at the end of each month? b)at the beginning of each month?

A lease requires payments of $1200.00 at the beginning of every quarter for ten years. If interest is 6% compounded monthly, calculate the value of the lease.