MA373 S10 Test 1-1 - Instructions DO NOT OPEN THE TEST...

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Instructions DO NOT OPEN THE TEST UNTIL TOLD TO DO SO. Put your answer (A, B, C, D, or E) on the Answer Sheet. Do NOT remove the answer sheet from the packet. If you want full credit for those correct or Partial Credit for those that are wrong You must show your work. You may only use the approved calculators. Use of other calculators will result in you receiving a zero on this test. If you have a question, raise your hand and I will come and see you. GOOD LUCK!
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Answer Sheet Question Answer 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
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1. The nominal interest rate over the last year was 9%. The rate of inflation over the last year was 5%. Calculate the real rate of interest over the last year. A. -3.7% B. -4.0% C. 3.8% D. 4.0% E. 14.5%
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2. A loan of is being repaid with level annual payments of 1000 for 20 years. The outstanding balance of the loan immediately after the 12 payment is 6,569.02. Calculate the annual effective interest rate on the loan. A. 4.6% B. 6.1% C. 7.5% D. 10.8% E. 14.1%
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Brandon purchased a car with a car loan of 15,000. The loan has an annual effective interest rate of 12%. The loan will be repaid with monthly payments over 5 years.
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This note was uploaded on 02/05/2012 for the course MA 373 taught by Professor Staff during the Spring '08 term at Purdue University-West Lafayette.

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MA373 S10 Test 1-1 - Instructions DO NOT OPEN THE TEST...

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