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    25 Multiple Choice Questions

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    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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    https://brainmass.com/business/interest-rates/25-multiple-choice-questions-261983

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

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