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Unformatted text preview: " ) use Fc Questicn13 {3 points)" Date or loan: 1'r1r2003. 'Payments: Level payments at the end cf each year. Firstpayment: 12:31:03.
Payment pericd: 20 years.
The principal pcrticn cf the 1 3‘“ payment is $54.40. The principal pcrticn'of the 13”" payment is $32.99. “’1 i. _.s ._.. '— W Y‘f‘t‘ﬁ‘ ‘5‘ 7° “‘1 c; RS. 5!“ _ "" w x... —_. a; '7 ' "‘7 " .c ___ 11?] iii" d5 _ t I (gran)? i__ w  i" 9'3 ‘ﬂ Questicn 13 In what range is the tctal amount at interest paid an the loan? [A] Less than $625 ' $625 but less than $640 [[3] $6413 but less than $655 ff) [El] $655 but less than $6Tﬂ [E] $670 cr more *1 w I. . MCQ I Data for Question ] {3 points) Srnilh takes a loan rapa'yahle by equal installmants at Ifha and 5r each year for 2) ycars. Both the principal and interest ponions of the 11th paymant an: 51m]. w Hi “ W FMLﬂ w_u*"'m: lmeiﬂF‘LE?
“Jamal: mar4m = mam+13qu Question  In what range is the initial atnuunt ul’tha loan?
{A} Less than $1,500
(B) $1,501? but less than Slﬂ'ﬂﬂ {C} $1,Tﬂﬂ_hul leas than “Still an ,atm but less than $2,]Dﬂ {E} 51,1 DD or more 3 Exam EAl: Spring 211116 2 GO ON TO NEXT PAGE at. . , O ’ . Data for Question 23 (3 points} . .
A loan is made on 1t1l‘2ﬂDtl. 'Lean repayments: 120 level manthlypayments of interest and prineipal with the ﬁrst _
payment at 2“ meta. lnterest is charged an the leanat a rate of it”) = 15%. 
Amount of interest paid in the 54'“ payment of the lean = $1 DD. F =.F'rineipal outstanding on the lean after the t=ll2lEh payment. H ________——1 E JEWEK" '
.I'l 1': Eli WT “ea "if—W Question 2:
In what range is F'?  _ Less than $3,DD5
{a} seeds but less than sedan
(C) $E,D2D but less than $3,035
{D} $B.D35 but less than $E.ﬂ5El
(E) EBJJEU or mere whyems «l . ' as    ' .
a Data For Queetion 20 [5.pointe) I ' I _ .
' ' Deteotloan:1!132l2l33. ' "
Payments: Annual paymentsoi $1,000 at the end of eaoh.year.
'Firel payment: 1331:2003. Payment period:_ 25 years; Loan interest rate: 3% compounded annually; X is the present yaIUe of interest payments at 1.‘1!2EID3 over the life oi the loan,
using an interest rate of 12% compounded annually. Question 20 l: 1 { t ‘1"
In what range is X? _ t . ,3: .. tar . and "q
[A] Less than $4,6oo  ._ 15
B $4.5oo but less than $5,5oo _ "’
[C] $5;ooo but less than $6,600 [o] $B.6Elﬂ butlesethan $7.5oo £33 '2 x [E] $?.BDD or more 0,; .' 
Data For uestion 4 (3 points)  Smithobtains a $300,000. 30year mortgage with level end of month payments.
The interest rate is 29.5%. compounded annually. With the 120"1 payment, Smith
makes an additional payment o1v$2.000 and immediater reﬁnances the outstanding balance with a 20year. 7.0% compounded annually, mortgage with
level end of month paymentsof P. "m é_ pm rHT_Fo eta
r‘ EU 3 3311 
7;? H 1mm W1 ad; '3}
‘D " ' 1.45M ‘
. If dragsL? Mama
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ass ' L'tuestion 4'
In what range is P?
[A] Less than $1,000
[31 $1,900 but less than $1,950 @ $1,950 but less than $2,000 [D] $2,000 but less than 152050 [E] $2,050 or more a j W Data foyﬂueation TI" {4 points] Details on a loan made on 1II1IEDD4: Number of payments: 10. Amount of each payment: aaaoo. Date of ﬁrst paymentzi 12:31l2ﬂﬂ4. Interest rate: I 3% compounded annually.  tmmedlately alter the sixth payment, an additional $1ﬂ,ﬂﬂ[t payment is made. The
loan is reamortized over a longer term to proyide for annual payments of $1,Elﬂ[t and
a ﬁnal smaller payment of X paid one year alter the Iaat$11ﬂﬂﬂ payment. 35 ﬂ (gem? cl (3
A _tofﬁ§qm? é __
3 aagaxr i _ a —
“l "' ' r—” '._
t. ___ halt
L773M ME In what range is X? (A) Leaa than $350 {B} $35G but less than $45!?!
I {C} 54513 but leaa than $550 {D} $551] but less than $853 ' ® $55!] or more “MW GM Question 3 57¢ Data tor Question 3 (3 points) Terms of a $1,0EID loan issued by Smith: Length of loan: 20 years.
Payments: Leyel annual payments at the end of each year.
Interest; 5% nominal. convertible semiannually. When 'Smith receives each payment, it is immediately reinvested at 5%.
oompounded annually.  Ft is the effective annual rate of interest eamed by Smith on his combined
investments over the 2D year period. I 31 1. is WEI FF.” we 2_ 11‘ l 4' 3” l?
t in; m — F —
'10 — tmj me d5 — *— xre— 4m 2 45 — —
K 3!. I
in what range is Ft? ‘5 ‘ 3 ct
(A) Less than 5.5%
out
{E} 5.57% but less man 5.52%
to} 5.52% but less than 5.57%
to} 5.57% out lees than 5.72% {E} 532% or more Data fer Duestien 1] '[4 points} car Date of lean: 1l'1l2l3ll15. 2] annual payments beginning 12l31i'2DD5. The
payment is X in the ﬁrst 1E]I years, and 55% of X in
the sedend 1] years. ' . Terms 01 lean repayment: Interest rate: 5%, edmpdunded annually. ’1’ is the ratle el‘ prineipel repaid in the Hi111 payment to principal repaid In the 11"1
HI—q. . ITIIE I11.
531..— uesien a d t 1n W umﬁq? a In what range is Y? r': “’T m. 32's t "fr F
{A} Less than 2.4:: I“ S. ass/«ED 7’
1E! .53. ElﬁnTl .
E 2.45 but less than 2.45
.45 but less than 2.52 f" {D} 2.52 but less than 2.55
[E] 2.55 or more We? Gtrl  O ’3» a ' ‘ é Data For Question 3 [4 points) '  . I. Date of loan: 1l'1i‘2003.
Amount of loan: $10,000.
Term of loan: 30 years.
Interest rate: 7.5% compounded annually. Payments: Annual payments with the ﬁrst payment at 125302003; each
subsequent payment is 3% larger than the immediately preoeding payment. X = the total interest paid through the 20"” payment. [oleﬁn T. Farri Elﬁrf )
1.? "'LT—jﬁr?‘
_ viiiam .
3“ Vl  C *4 .PWT "LE ___.ME’ I
a '— F L ’” is r = miniW . ~ tb _
so Watts _ a ' ‘F 53“ ilk/O v" K'Bt it a H, . (E61145 (renewlb ‘
MAJQJFE '. : thsjﬂf Question 3 __ ' 3*“ i 'l £51 3 a
w 1 t. trig‘3 {St
in what range is )1? '7. h” 5'“: A“) .55. “L i ' ; Km 3 o
[A] Less than $14,750 W @A r ,—
, 65M” 3 '
[B] $14,?50 but less than $15,250 @ $15,250 but less than $153le fax [D] $15,?50 but less than $15250 J, [E] $15,250 ormore ’) “0% Data for l{Juestlcg B {3 points} Amount of loan: $1U,ﬂﬂﬂ.
‘ Term of lean: 20 years.
lntereslrate on loan: 5% per annum, eﬁeclive. Terms cf loan repayment: 2i) annual payments beginning at the end at year1
 consisting of sscc principal plus interest on me
outstanding balance at the lean. mm in what range is the total amcunt cf interest and principal paid over the term at the
loan? A Less than $15.1)Dﬂ @ $15,001? but less than $15,4dd [C] $15,4DD butless lhan $151BDD
(c) s1s_scc but less than $15,200 {E} $15,2ﬂﬂ or more 3
ww— aw 0Q
_ @
096 Data for Question 5 [4 paints} [in lilflﬂﬂﬁ, Smith burrows a sum of money repayahle in annual payments at the end cf
each year fer it] years. Each annual payment contains principal and interest. The principal in the payment at the end or year t equals Fulﬁl]! (For! =1, 2,3,...,2ﬂ}. The
payment at the end cf‘the year also includes the interest accrued during the year. _ Interest rate: 613%, cernpnunded annually. X = the present value at 1.! lilﬂﬂﬁ of interest payments made during the It} years cf the I lean.
Question 5 1 .3" m 9the. 11}! a In what range is X? (:1) Less than 39,0013 {B} $9,DDD but less than $1 {tﬁﬂﬂ
{C} S tl,tlJJ but less than $1 Lil[ID SI Ltlﬂﬂ but less than Ellﬂﬂﬂ (E) $11,t]t]t] er rncre Elam Eat1: Spring Zﬂﬂt‘i  ON TO NEXT PAGE Q) 3
’3 Data Fo[ Question 12 {3 points] A tenyear loan of $10,000 at an 0% annual effective rate can be repaid using
any of the four following methods:  L Amortization method. with level annual payments'at the end of each
year. '  ' ll. Repay the principal at the end of tenyears vvhile paying 0% annual
effective interest on the loan at the end of each year. The principal is
repaid by making equal annual deposits at the end of each year into
a sinking fund earning interest at 0%.annual effective so that the _ sinking fund accumulates to $10,000 at the end of the 10“1 year. W —— Ill. . Same as ll, except the sinking fund earns 0% annual effective.
if . ’0 1V. Same es ll, except the sinking fund earns'12% annual effective. rx J ' ' 11'<Iiﬂ<l Question 12 Rank the annual payment amounts of each method.
[A] l'ﬁ II ‘ ill "1 W [B] l¢=ll'~'IVI 10]" Is IV: m 1: ll ﬂ [o1'lvle'zInzn J @The correct ansvver is not given by [A]. [E], [C]. or [D]Ial:rove a). {9%'. II_ p .. 6 Data for uestio 1T {4 points} Loan tenns: $1ﬂd_tlt]ﬂ borrowed on 1l1l2D04. issued at aiﬁtm‘lt. annual
effective interest rate. .  . Loan repayment Ho repayments ol principal or interest are made on the loan until
a sinking fund has accumulated to pay the balance in full. This occurs at12r'31f2ﬂ19. . g .
' : 'tﬁbimﬁwsjmt "U Erie—IRRE'W Sinking fund: $1 o,ooo annual deposits from 12c1r2oo4 through 12l31i'2ﬂ11 65m
' and $_5,DDEI annual depcslls beginning on 1331IED127Tﬁe _ ' 95 Elm“
sinking fund accumulation rate Is i‘lt. until 12e1r2o11 and lt'it':
therealter. ' During calendar year 2E1 1. interest accrued on the loan and interest earned on the sinking fund are the 'ss—rrTeT  F
m tillwant = ramslsST“WUWG LJJ'W‘J~ Ekmﬂ“ 1L lUJITIJ ‘1"er 7' joqr'hﬂu £11.31“ l t .uk ' 5 , o~duH:  .1 a . __ I.“
. . ll T t}:
Question 1? Q G D {waist5}" LEE“? LEE‘L In what range is will? _ 7B
As  Less than stars
(3} . 6.1 [1% but less than E.Eﬂ%
(e) asoas but less than v.1 as
{D} 110% but less than Tﬁlll‘lt. {E} 130% or more
@ﬂﬂcékct f l o’é Data For Question 13 (3 points}
Date of loan: 1l'1r'2003.
Payments: Leyel payments at the end of each year.
First payment: 12i31l’03.
Payment period: 20 years.
The principal portion of the 13lh payment is $54.40.
The principal portionof the 1Elh payment is $70.09.
an a. E“ y low“? E V 5i 5*
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‘5' W1
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I *1 it? it“ ‘5
l _ 42 {60> ..
w — ﬁ' 9‘! r
i. 600 ' ' W
W : QM L“ K“ 9’0 A
2:. (9/1. L
Question 13
In what range is the total amount of interest paid on the loan?
[A] Less than $625
sszs but less than saw [0] $540 but less than $655
[D] $655 but less than $570 [E] $6701] or more 0A 2
(26 Data for Question E [3 points} Smith takes a lean repayahle by equal installments at the end eFeaeh year Far 20' years.
Both the principal and interest partiens arthe i lth payment are $lﬂﬂ. w W ‘1' m ﬂmu‘fﬂ m_h¢m: itEUXﬁtCJ
wilds {a Sim *— tswtwllqs L W * "°
1— iﬂCtrFuh :(iﬂh‘w
v1 LarvaL “3 sh! Ct) cit" 2' E
to am} __ «4 {W7 9‘ '1’”. Question 1 In what. range is the initial ameunt ei‘Lhe loan?
[A] Less than $1,500
{B} 51,5130 but less than SiJﬂﬂ Elﬂﬂﬂ but less than $1,900 (C)
513% but less than same
{E} 362,1 Eli} er rnere Exam EAL1: Spring IBM» 1 GO ON TU NEXT PAGE ...
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This note was uploaded on 03/02/2012 for the course MATH 172 taught by Professor Kong during the Winter '09 term at UCLA.
 Winter '09
 kong

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