fall 2010 exam

# fall 2010 exam - (5 points How much interest will you have...

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(5 points) How much interest will you have to pay for a credit card balance of \$560 that is 2 months overdue, if a 23% annual (simple) interest rate is charged? 1. \$21.47 2. \$21.67 3. \$93.33 4. \$128.80 5. \$257.60 2. (5 points) What annual interest rate is earned by a 33-day T-bill with a maturity value of \$1,000 that sells for \$996.16% 1. 4.002% 2. 4.205% 3. 4.264% 4. 4.502% 5. 4.626% 3. (5 points) To complete the sale of a house, the seller accepts a 120-day note for \$5,000 at 8% simple interest. (Both interest and principal are repaid at the end of 120 days). Wishing to use the money sooner for the purchase of another house, the seller sells the note to a third party for \$5,013.33 after 40 days. What annual interest rate will the third party receive for the investment? 1. 8.025% 2. 10.755% 3. 10.772% 4. 21.510% 5. 21.543% 4. (5 points) A zero coupon bond with a face value of \$35,000.00 matures in 16 years. What should the bond be sold for now if its rate of return is to be 4.699% compounded annually?

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1. \$16,526.68 2. \$16,787.56 3. \$19,978.99 4. \$61,314.40 5. \$72,970.71 ...show all work...show all work...show all work...show all work...show all work...show all work... Page 1 of 7 Math 1300 Fall 2010 Exam 1 No Work = No Credit Name: SOLUTIONS Student Number: 5. (5 points) What is the APY for money invested at an annual rate of 4.8% compounded con- tinuously?
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