Quiz - 1 Answers - Quiz I COMM 308 This quiz is due on...

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Quiz I COMM 308 This quiz is due on Tuesday, 29/10. Please bring it to the class. Each question carries one mark. 1. If the interest rate is 10% per year, how long would it take to double your money? A. 6.14 years B. 6.93 years C. 7.27% years D. 8.34% years Solution: PV = -1, FV = 2, I/Y = 10, CPT N. N = 7.27 2. Your aunty has offered to gift you $5,000 after two years? How much is this worth today if the interest rate is 6% per year? A. $4,449.98 B. $4,531.36 C. $4,580.75 D. $4,608.62 Solution: FV = 5,000, N = 2, I/Y = 6, CPT PV. PV = -4,449.98
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3. If you make a deposit of $1,500 today in your bank and the bank offers you an interest rate of 5% per year, how much money would you have after 4 years? A. $1,800.73 B. $1,810.11 C. $1,823.26 D. $1,898.88 Solution: PV = -1,500, I/Y = 5, N = 4, CPT FV. FV = 1,823.26 4. You made a deposit of $2,500 five years ago and it now worth $3,500. What interest rate have you received over the past five years? A. 6.96% B. 6.28% C. 7.13% D. 7.66% Solution: PV = -2,500, N = 5, FV = 3,500, CPT I/Y. I/Y = 6.96 5. You are going to make 10 yearly deposits of $10,000 starting today . If the interest rate is 6.5%, how much do you expect to have in your account after 10 years?
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B. $143,715 C. $154,618 D. $162,349 Solution: This is an annuity due problem. Set the calculator to the BGN mode. PMT = -10,000, N = 10, I/Y = 6.5, CPT FV. FV = 143,715 6. You have taken a $300,000 housing loan and the bank charges you an interest rate of 0.75% per month. The loan is to be repaid by making equal monthly payments for the next 15 years. What is the monthly payment you have to make to the bank? A. $3298.62 B. $3266.73 C. $3193.54 D. $3042.80 Solution: PV = 300,000, I/Y = 0.75, N = 15 x 12 = 180 (months), CPT PMT. PMT = 3,042.80 7. Starting next year, you are going to receive $2,000 every year for the next 8 years. If the interest rate is 9%, what is the present value of this income stream? A. $10,183.22
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This note was uploaded on 10/16/2010 for the course COMM Comm 308 taught by Professor Ravimateti during the Fall '09 term at Concordia Canada.

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Quiz - 1 Answers - Quiz I COMM 308 This quiz is due on...

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