Finance Quiz 2.docx

Finance Quiz 2.docx - Question 1 Correct Mark 1.00 out of...

Info icon This preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text The value of a dollar invested at positive interest rate grows over time. Select one: True False Feedback The correct answer is 'True'. Question 2 Not answered Marked out of 1.00 Flag question Question text The further in the future you receive a dollar, the more it is worth today. Select one: True False Feedback The correct answer is 'False'. Question 3
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Not answered Marked out of 1.00 Flag question Question text Compounding is the process by which interest earned on an investment is reinvested so that in future periods, interest is earned on the interest as well as the principal. Select one: True False Feedback The correct answer is 'True'. Question 4 Not answered Marked out of 1.00 Flag question Question text The higher the interest rate on an investment, the greater the amount of money that is accumulated for any time period. Select one: True False Feedback The correct answer is 'True'. Question 5 Not answered Marked out of 1.00
Image of page 2
Flag question Question text How long (in years, to 2 decimal places) will it take for $1010 to accumulate to $1980 at 6.3% p.a. simple interest? Answer: Feedback I = S - P = 1980 - 1010 = 970 I = Prt 970 = 1010 × 0.063 × t t = 970 1010 × 0.063 t = 15.24 The correct answer is: 15.24 Question 6 Not answered Marked out of 1.00 Flag question Question text Find the rate of simple interest p.a. if $1650 accumulates to $1730 in 11 months. (as a %, 2 decimal places) Answer: Feedback
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
S = P(1 + rt) 1730 = 1650(1 + r × 11/12) r = ( 173 0 165 0 - 1) × 1 2 1 1 or I = S - P = 1730 - 1650 = 80 I = Prt 80 = 1650 × r × 11/12 r = 80 × 12 1650 × 11 = 0.052893 = 5.29% The correct answer is: 5.29 Question 7 Not answered Marked out of 1.00 Flag question Question text Eugene wants to buy an artwork in 90 days' time that is worth $10 000. He deposits $X into the bank that pays a simple interest of 4.1% p.a. Calculate X, correct to the nearest cent. Assume 365 days in a year. Answer: Feedback The correct answer is: 9899.92 Question 8 Not answered Marked out of 1.00
Image of page 4
Flag question Question text How long (in years) will it take for $20,000 to grow to $25,000 at 9%p.a. simple interest? (in years correct to two decimal places) Answer: Feedback The correct answer is: 2.78
Image of page 5

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 6
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern