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172A 2010 Exam 2

# 172A 2010 Exam 2 - Math 172A Second Exam 1 Name Starting at...

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Math 172A – Second Exam – 11/19/10 Name: _______________________ 1. Starting at the end of year 1, Aaron invests \$2,000 each year for 10 years in account A earning 5% effective annual rate. He reinvests each interest payment in account B earning 8% effective annual. Determine Aaron’s overall annual yield rate over 20 years, assuming he does not make any withdrawals during the 20 year period. n i PV PMT FV beg/end

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2. Jiren makes a series of payments into a Fund at the beginning of each year for 20 years. The first payment is 100. Each subsequent payment through the tenth year decreases by 3% from the previous payment. After the tenth payment, each payment increases by 4% from the previous payment. The Fund earns interest at an annual effective rate of 7%. Determine the amount in his account at the end of 20 years. n i PV PMT FV beg/end
3. The borrower in a \$238,000 loan makes interest payment at the end of each 6 months for 8 years. These are calculated using an effective discount rate of 6.5%.

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172A 2010 Exam 2 - Math 172A Second Exam 1 Name Starting at...

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