Finite Math
Week4Quiz FinancialTopics
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
3. 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
5. 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

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 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
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