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# MCQs-Mathematics of Finance

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20 MC Questions on mathematics of Finance. Example:

1.
Find the present value of the future amount. Assume 365 days in a year. Round to the nearest cent.
\$18,350 for 119 days; money earns 3.3%
A) \$195.32
B) \$18,156.30
C) \$17,763.79
D) \$18,154.68

2.
Find the sum of the first five terms of the geometric sequence.
a = 3, r = -4
A) 1023
B) 615
C) -1023
D) -615

3.
Find the sum of the first five terms of the geometric sequence.
a = 12, r = 4
A) 252
B) 7710
C) 268
D) 4092

4.
Find the actual interest rate paid, to the nearest tenth, on the simple discount note.
\$49,000; discount rate 5%; length of loan 6 mo
A) 6.1%
B) 5.1%
C) 4.1%
D) 7.1%

5.
Find the compound interest earned by the deposit. Round to the nearest cent.
\$830 at 7% compounded annually for 20 years
A) \$1103.90
B) \$2171.72
C) \$1162.00
D) \$2381.84

6.
Find the compound amount for the deposit. Round to the nearest cent.
\$1900 at 10% compounded quarterly for 4 years
A) \$2097.24
B) \$2781.79
C) \$2660.00
D) \$2820.56

7.
Solve the problem.
Tuition of \$2600 is due when the spring term begins, in What amount should a student deposit today, at to have enough to pay tuition?
A) \$2452.83
B) \$111.96
C) \$2500.00
D) \$2488.04

8.
Find the monthly house payment necessary to amortize the following loan.
In order to purchase a home, a family borrows at 8.8% for What is their monthly payment? Round the answer to the nearest cent.
A) \$4023.64
B) \$792.00
C) \$853.50
D) \$1244.22

9.
Find the present value of the ordinary annuity.
Payments of \$3900 made annually for at 9% compounded annually
A) \$38,269.14
B) \$38,723.10
C) \$37,853.40
D) \$38,308.05

10.
Find the exact interest. Use 365 days in a year, and use the exact number of days in a month. Round to the nearest cent, if necessary.
A loan of \$97,000 at 13% made on Feb 18 and due on June 30
A) \$4728.75
B) \$4560.33
C) \$4663.97
D) \$4623.67

11.
Find the periodic payment that will render the sum.
S = \$55,000, interest is 4% compounded annually, payments made at the end of each year for
A) \$5170.81
B) \$4471.66
C) \$10,154.50
D) \$3304.20

12.
Find the periodic payment that will render the sum.
S = \$23,000, interest is 18% compounded monthly, payments made at the end of each month for
A) \$486.51
B) \$6438.25
C) \$612.70
D) \$509.80

13.
Find the compound interest earned by the deposit. Round to the nearest cent.
\$20,625 at 12% compounded continuously for 5 years
A) \$37,581.20
B) \$37,577.49
C) \$13,377.58
D) \$14,353.97

14.
Find the compound amount for the deposit. Round to the nearest cent.
\$5000 at 7% compounded semiannually for 8 years
A) \$7800.00
B) \$6584.05
C) \$8669.93
D) \$8590.93

15.
Find the sum of the first five terms of the geometric sequence.
a = , r = 2
A)
B)
C)
D)

16.
Find the present value of the future amount. Assume 365 days in a year. Round to the nearest cent.
\$18,000 for 9 months; money earns 8.5%
A) \$16,589.86
B) \$16,921.27
C) \$17,034.70
D) \$17,915.00

17.
Find the sum of the first five terms of the geometric sequence. (Please see the attachment)
a = , r = 2
A)
B)
C)
D)

18.
Find the interest. Round to the nearest cent.
\$1390 at 7.5% for 2 months
A) Interest = \$52.12
B) Interest = \$1737.50
C) Interest = \$208.50
D) Interest = \$17.38

19.
Find the interest. Round to the nearest cent.
\$2180 at 15% for 22 months
A) Interest = \$59,950.00
B) Interest = \$599.50
C) Interest = \$14.86
D) Interest = \$7194.00

20.
Find the amount that should be invested now to accumulate the following amount, if the money is compounded as indicated.
\$3000 at 8% compounded semiannually for 8 yr
A) \$5618.94
B) \$1620.81
C) \$1601.72
D) \$1398.28