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# Question 1 (1 point) Question 1 options: Marcy placed \$2,700 a year into an investment returning 5 percent a year for her daughter's college...

Question 1 (1 point)
Question 1 options:
Marcy placed \$2,700 a year into an investment returning 5 percent a year for her daughter’s college education. She started when her daughter was 2. How much did she accumulate by her daughters 18th birthday?

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Question 2 (1 point)
Question 2 options:
Todd was asked what he would pay for an investment that offered \$1,900 a year for the next 32 years. He required an 7 percent return to make that investment. What should he bid?

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Question 3 (1 point)
Question 3 options:
Ann was offered an annuity of \$20,000 a year for the rest of her life. She was 55 at the time and her life expectancy was 84. The investment would cost her \$180,000. What would the return on her investment be?

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Question 4 (1 point)
Question 4 options:
How many years would it take for \$2,000 a year in savings earning interest at 6 percent to amount to \$60,000?

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Question 5 (1 point)
Question 5 options:
Aaron has \$50,000 in debt outstanding with interest payable at 12 percent annual. If Aaron intends to pay off the loan through 4 years of interest and principal payment, how much should he pay annually?

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Question 6 (1 point)
Question 6 options:
What is the difference in amount accumulated between a \$10,000 sum with 12 percent interest compounded annually and one compounded monthly over one year period?

Compounded monthly =

Compounded annually =

Difference in amounts =

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Question 7 (2 points)
Question 7 options:
What is the difference in future value between savings in which \$3,000 is deposited each year at the beginning of the period and the same amount deposited at the end of the period? Assume an interest rate of 8 percent and that both are due at the end of 19 years.

(a) Annuity Due (beginning of period) = ______

(b) Ordinary Annuity (end of period) = ______

(c) Difference between "ordinary annuity" and "annuity due" = _______

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Question 8 (1 point)
Question 8 options:
Kenneth made an investment with the following cash flows:
YEAR 1 \$20,000 Cash investment
YEAR 2 \$ 5,000 Cash return received
YEAR 3 \$ 8,000 Cash payment made
YEAR 4 \$20,000 Invested cash returned
8% Required Rate of return

What was the net present value (NPV) of his investment?
Note: Round your answer to the nearest whole dollar. Omit the comma and "\$" sign in your response. Use "+" or "-" before the number to indicate if your final answer is positive or negative NPV. (i.e. +4599 -13667 +1500 -3220 etc.)
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Question 9 (1 point)
Question 9 options:
Becky made an investment with the following cash flows:
YEAR 1 \$ 30,000 Cash investment
YEAR 2 \$ 10,000 Cash return received
YEAR 3 \$ 8,000 Cash return received
YEAR 4 \$ 11,000 Cash return received
YEAR 5 \$ 9,000 Cash return received
What was her internal rate of return over the five year period?

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Question 1 options:
Marcy placed \$2,700 a year into an investment returning 5 percent a year for her daughter’s
college education. She started when her daughter was 2. How much did she accumulate...

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