Math1313-Chapter5-Identify-problem-with-key - Chapter 5...

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Chapter 5: Math of Finance Problems Identify the type of problem. 1. Anna wants to have $5,000 saved when she graduates from college so that she will have a down payment for a new car. Her credit union pays 5% annual interest compounded monthly. How much money should she deposit each month to have the money available when she graduates in 3 years? 2. Bill bought a new car. His financing deal was a 5 year loan at 9.98% annual interest compounded monthly. His monthly payment was $421.25 and he paid no money down. What was the total purchase price of the car? 3. Sergio wants to have $5,000 in the bank in 3 years to pay for an Alaskan cruise. How much cash should he deposit today, if the bank pays 4% annual interest compounded quarterly, if he wants to be sure to have the funds available in 3 years? 4. Edwin and Frances are buying a new home. The purchase price is $155,000. They will make a 10% down payment on the house. Their loan for the house is a 30 year conventional loan at 6.75% per year compounded monthly. Find their monthly payment. 5. Grace decides to start a savings program when she gets her first job after graduation. She deposits $2,500 into her credit union savings account. The credit union pays 3.8% annual interest compounded quarterly. How much money will she have in the account after 4 years? 6. Helen bought a new computer. The finance company charged her 15% per year compounded monthly. Her monthly payments were $88.23 for 2 years and she made no down payment. What was the original price of the computer? 7.
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Math1313-Chapter5-Identify-problem-with-key - Chapter 5...

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