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Math1313-Test3-Review-Key-S10

# Math1313-Test3-Review-Key-S10 - Math 1313 Test 3...

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Math 1313 Test 3 Supplemental Review Solutions 1. Present Value of an Annuity + = i i R P n ) 1 ( 1 + = 12 09 . 12 09 . 1 1 350 48 = \$14064.67 2. Amortization Part I: n i Pi R + = ) 1 ( 1 = 72 ) 12 18 . 1 ( 1 ) 12 18 . ( 12000 + = \$273.69 Part II: 273.69*72 = 19,705.93, so you will pay \$19,705.93. Recall the Cash Value of the tractor is: \$12,000 so 19,705.93 – 12,000 = 7,705.93, so you will pay \$7,705.93 in interest. 3. Effective Rate 1 1 + = m eff m r r 1 12 10 . 1 12 + = = 1047 . % 47 . 10 = eff r 4. Future Value with Compound Interest n i P A ) 1 ( + = 68 ) 0225 . 1 ( 5000 + = = \$22,702.60 5. Present Value of an Annuity + = i i R P n ) 1 ( 1 83 . 25319 12 089 . 12 089 . 1 1 37 . 524 60 = + = 83 . 319 , 28 \$ 000 , 3 83 . 319 , 25 = + Math 1313 – Test 3 Supplemental Review 1

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