ACCG
Finance Quiz 2.docx

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

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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

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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
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

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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
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

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