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practiceq6(4B)

# practiceq6(4B) - 4B practice KEY Show all work for credit...

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4B practice - KEY Show all work for credit. Round answers to two decimal places. 1.) Dan deposits \$100 each month into a retirement fund that pays 2.65% compounded monthly. a) How much will he have in the account when he retires after working for 35 years? (2 points) PMT = 100 APR = 0.0265 n = 12 Y = 35 A = 100 (1 + 0.0265 ÷ 12) 12 35 - 1 (0.0265 ÷ 12) = \$69083.63 b) How much interest will Dan have earned? (1 point) Interest = Accumulated balance – total amount deposited Total amount deposited = \$100(12)(35) = \$42000 Interest = 69083.63 – 42000 = \$27083.63 2.) A 30-year \$10,000 US Treasury Bond is quoted at 97.5 points with a current yield of 7.5%. Find the annual interest payment. (2 points) annual interest = current yield current price current price = 10000 0.975 = 9750 annual interest = 0.075 9750 = \$731.25 3.) Melissa buys 100 shares of XYZ stock for \$50.25 per share.

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practiceq6(4B) - 4B practice KEY Show all work for credit...

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