Question 1 [5 points]
Alan has forgotten the rate of simple interest he earned on a five-month term deposit at the bank. At the end of the five-month period, he received interest of $169.00 on his $5,200.00 deposit. What monthly rate of simple interest did his deposit earn? Note: Please make sure your final answer(s) are in percentage form and are accurate to 2 decimal places. For example 34.56%
- Monthly interest rate = ?%
Question 2 [5 points]
Chauncey was charged $222.25 interest on his bank loan for the period May 24 to July 16 of the same year. If the annual rate of interest on his loan was 5.00%, what was the outstanding principal balance on the loan during the period? For full marks your answer(s) should be rounded to the nearest cent.
- Outstanding principal balance = ?$
Question 3 [5 points]
Raisel received the proceeds from an inheritance on May 22. She wants to set aside enough on May 23 so that she will have $19,000 available on October 28 to purchase a car when the new models are introduced. If the current interest rate on 91- to 180-day deposits is 6.25%, what amount should she place in the term deposit? For full marks your answer(s) should be rounded to the nearest cent.
- Principal = $?
Question 4 [5 points]
Josh borrowed money from Cedric and agreed to pay back $1,200 6 months from now and $1,500 in 9 months. If Josh has a lot of money available at the time of the first payment and wants to pay back the loan completely at that point, how much money would Josh have to pay Cedric if money could earn 3%? For full marks your answer(s) should be rounded to the nearest cent.
- Full Payment Amount = $?
Question 5 [5 points]
Wynn was scheduled to repay a loan 90 days from now with a payment of $2,400.00, but will get some extra money and be able to pay it off 20 days from now with an equivalent payment of $2,376.08. Assuming that interest rates do not change during the period of the loan, what was the interest rate of the loan? Note: Please make sure your final answer(s) are in percentage form and are accurate to 2 decimal places. For example 34.56%
- Annual rate = ?%
Question 6 [5 points]
Paul purchased a short-term $14,000, 90-day GIC which will earn 3% interest annually. When the GIC matures, the maturity value is rolled into another short-term 180-day GIC which will earn 2% interest annually. What is the maturity value of the second GIC? For full marks your answer(s) should be rounded to the nearest cent.
- Maturity value = $?
Question 7 [5 points]
Cody bought a 90-day, $58,000 face value commercial paper on its date of issue when yields were 1.06%. He sold it 44 days later when yields were 1.23%. What was his gain on the investment? For full marks your answer(s) should be rounded to the nearest cent.
- Gain = $?