Exam 7: Applications of Percent

Use estimation to select the best response. If you deposit $100 in a bank account for a year, the future value is likely to be: Choose 105.00, 5.00, or 1.00. $ __________

The finance charge disclosure on a Sears Revolving Charge Card statement is shown here. Why do you suppose that the limitation on the $40$ cent finance charge is from $2.00 to $26.67? For balances over $26.67, the interest would be __________ (answer more or less ) than __________ (answer $0.40 or $2.00)

Calculate the future amounts $( A )$ you would have if $1,500 were invested at 9% for 7 years with simple interest and if it were invested with annual compounding. What is the difference between the two to the nearest cent, and does compound interest yield more or less than simple interest? at simple interest, $ __________; with annual compounding, $ __________; difference, $ __________; thus compounding gives: __________ (Answer more or less )

What is wrong, if anything, with the statement below? Answer true or false . If false, explain your reasoning. From the bank's point of view, the best method of calculating interest is the previous balance method.

Determine the maximum monthly payment for a house (to the nearest dollar), if gross monthly income is $1,190 and if current monthly payments for bills total $205. $ __________

A newspaper advertisement offers a $3,000 car for nothing down and 36 easy monthly payments of $111.16. What is the total amount paid for both car and financing? Round your answer to the nearest dollar.

Find the missing values, assuming simple interest. ">$\text { cellpadding }=" 0 \text { " cellspacing }=" 0 " \text { width }=" 69 \% \text { " border=" } 1 ">$ I P r t Future Interest Principal Rate Time Value

Determine the amount to be financed for a home with a price of $150,500 and a down payment of 20%.

What are the bank charges for 5 points on a house with a borrowed amount of $55,750? Round your answer to the nearest cent. $ __________

Find (period rate), (number of periods), and (future value) for the information given. Fill in the table. cellpadding="0" cellspacing ="0" width ="90\% " border="1"> Compounding P r t n i N A Period Present Annual Time Period Number of Future Value Rate Rate Periods Value Semiannual \ 600 6\% 3 ? ? ? ?

A car dealer carries out the following calculations. What is the annual percentage rate? Round your answer to the nearest tenth of a percent. __________ %

What is $n$ for a semiannual compounding period?

Find (period rate), (number of periods), and (future value) for the information given. Fill in the table. cellpadding ="0" cellspacing ="0 " width=" 99\% " border ="1"> Compounding P r t n i N A Period Present Annual Time Period Number of Future Value Rate Rate Periods Value Quarterly \ 1,500 4\% 180 days ? ? ? ? n = __________ i = __________ % N = __________ A = $ __________

A newspaper advertisement offers a $9,000 car for nothing down and 36 easy monthly payments of $296.87. What is the APR? Round your answer to the nearest tenth of a percent.

Calculate the monthly finance charge for the credit card transaction. Assume that it takes 10 days for a payment to be received and recorded and that the month is 30 days long. Round your answer to the nearest cent. cellpadding="0" cellspacing="0" width=" 52\% " border="0"> Balance Rate Payment Method \ 4,00023\%\ 150 Average daily balance

Is the following statement true or false? If you obtain a quotation for a home costing $360,000, obtain a 30-year loan at $8.5 \% + \frac { 3 } { 4 } \text { point } + \$ 300$ , and make a 30% down payment, you can find the total amount of interest paid on this loan as follows: $\$ 360,000 \times 0.7 = \$ 252,000$ the Table entry for a 8.5%, 30-year loan is 7.69, so the monthly payment is $7.69 \times \$ 252 = \$ 1,937.88$ . Then, I =A-P =\ 1,937.88(360)-\ 360,000 =337,636.80

Give the amount of a 5% offer on a car that has a sticker price of $16,480 and a dealer's cost of $14,997 . Round your answer to the nearest dollar. $ __________

Use the table to answer the questions. ">$\text { cellpadding }=" 0 \text { " cellspacing }=0 " \text { align }=\text { "center" width }=" 48 \% \text { " border }=" 1 ">$ Effect of Down Payment on the Cost of a $\$ 120,000$ Home with Interest at $8 \%$ Down Payment Percent of House Price Monthly Payment 30 Years Total Payment 30 Years \ 0 0\% \ 880.52 \ 316,987 \ 6,000 5\% \ 836.49 \ 301,136 \ 12,000 10\% \ 792.47 \ 285,289 \ 24,000 20\% \ 704.41 \ 253,588 \ 30,000 25\% \ 660.39 \ 237,740 \ 36,000 30\% \ 616.36 \ 221,890 If you are obtaining a $120,000 house with a 30-year 8% loan, what would you save in monthly payments by increasing your down payment from $12,000 to $36,000? Enter the answer to the nearest cent. $ __________ What would you save in the total payments? Enter the answer to the nearest integer. $ __________

Estimate the answer by picking the best choice without calculating. The method of calculation most advantageous to the credit card company is the

Cole needs $378,000 in his retirement account to generate a retirement income of $1,890 per month when he retires in 35 years. He has $35,000 to invest today. What simple interest rate does he need to achieve his target of $378,000?