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25 Multiple Choice Questions

1.Find the interest. Round to the nearest cent.
$1280 at 12% for 9 months

A) Interest = $17.07
B) Interest = $115.20
C) Interest = $1382.40
D) Interest = $11,520.00

2. Find the value.
s 15,0.09 (Please refer to the attachments)

A) 33.003
B) 40.472
C) 29.361
D) 26.019

3. Find the actual interest rate paid, to the nearest tenth, on the simple discount note.
$50,000; discount rate 8%; length of loan 6 months.

A) 9.3%
B) 8.3%
C) 7.3%
D) 10.3%

4. Solve the problem.
How much must Harry's Hardware deposit be at 12.5% interest for 120 days in order to earn $600.00 interest?

A) $14,400
B) $14,600
C) $7200
D) $4800

5. Find the periodic payment that will render the sum.
S = $65,000, interest is 4% compounded annually, payments made at the end of each year for 5years.

A) $6110.96
B) $5284.68
C) $12,000.77
D) $3904.96

6. Find the compound amount for the deposit. (Round to the nearest cent).
$5000 at 7% compounded annually for 6 years.

A) $7012.76
B) $7100.00
C) $7503.65
D) $6750.00

7. Find the future value of the ordinary annuity. Interest is compounded annually, unless otherwise indicated.
R = $900, i = 7% interest compounded semiannually for 10years.

A) $23,637.33
B) $23,721.46
C) $25,451.71
D) $51,166.00

8. Find the value.
s 17, 0.01 (Please refer to the attachments)

A) 50.396
B) 44.501
C) 39.19
D) 53.592

9. Find the compound interest earned by the deposit. (Round to the nearest cent).
$1800 at 6% compounded quarterly for 6 years

A) $648.00
B) $753.33
C) $1968.20
D) $773.11

10. Find the amount that should be invested now to accumulate the following amount, if the money is compounded as indicated.
$12,400 at 12.6% compounded continuously for 6 years.

A) $5822.31
B) $25,168.77
C) $4582.31
D) $26,408.77

11. Find the effective rate corresponding to the given nominal rate. Round results to the nearest 0.01 percentage points.
14% compounded monthly

A) 14.49%
B) 14.93%
C) 3.82%
D) 14.75%

12. Find the payment necessary to amortize the loan.
$1600; 12% compounded quarterly; 8 quaterly payments.

A) $227.99
B) $322.09
C) $227.93
D) $205.49

13. Find the periodic payment that will render the sum.
S = $26,000, interest is 18% compounded monthly, payments made at the end of each month for 3years.

A) $549.96
B) $7278.02
C) $692.62
D) $576.30

14. Find the value.
s 21,0.038 (Please refer to the attachment)

A) 31.276
B) 29.168
C) 33.465
D) 57.592

15. Find the compound interest earned by the deposit. (Round to the nearest cent).
$710 at 9% compounded annually for 8 years.

A) $447.30
B) $587.91
C) $511.20
D) $704.72

16. Find the actual interest rate paid, to the nearest tenth, on the simple discount note.
$36,000; discount rate 6.0%; length of loan 4 months.

A) 5.1%
B) 8.1%
C) 6.1%
D) 7.1%

17. Find the amount of each payment to be made into a sinking fund so that enough will be present to accumulate the following amount. Payments are made at the end of each period. The interest rate given is per period.
$90,000; money earns 7% compounded semiannually for 16 and a half years.

A) $1569.74
B) $1012.23
C) $1418.37
D) $1491.52

18. Find the compound interest earned by the deposit. (Round to the nearest cent).
$15,000 at 4% compounded quarterly for 1/2year.

A) $1224.00
B) $301.50
C) $1200.00
D) $297.06

19. Find the indicated term of the geometric sequence.
a = 5, r =3/4 ; Find the 3rd term.

A) 16/45
B) 64/135
C) 135/64
D) 45/16

20. Find the indicated term of the geometric sequence.
a = 1/3 , r = 1/2 ; Find the 8th term.

A) 1/128
B) 1/768
C) 1/384
D) 1/48

21. Find the present value of the ordinary annuity.
Payments of $2000 made annually for 10years at 12% compounded annually.

A) $11,875.40
B) $11,300.45
C) $12,955.00
D) $11,304.40

22. Find the future value of the ordinary annuity. Interest is compounded annually, unless otherwise indicated.
R = $2500, i = 7% interest compounded quarterly for 16years.

A) $98,536.84
B) $290,758.26
C) $433,615.41
D) $283,300.51

23. Find the effective rate corresponding to the given nominal rate. Round results to the nearest 0.01 percentage points.
9% compounded monthly.

A) 1.81%
B) 9.38%
C) 9.31%
D) 9.20%

24. Solve the problem.
Novelties-and-Such borrowed $6700 for 75days and paid $213.39 in interest. Find the rate of interest on the loan.

A) 16.0%
B) 15.7%
C) 15.5%
D) 15.0%

25. Find the sum of the first five terms of the geometric sequence.
a =3/2 , r = 2

A) 1/4
B) 93
C) 5
D) 93/2

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1. B
2. C
3. The correct answer will be 4%, which is not given in the options.
4. ...

Solution Summary

This solution is comprised of detailed explanation and step-by-step calculation of the given problems and provides students with a clear perspective of the underlying concepts.

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