Financial Quiz 2

In order to pay for baseball uniforms, a school takes out a simple interest loan for $20,000 for 7 months at a rate of 12%. How much interest must the school pay?

• $1400

• $21,400

• $15,600

• $2,500

How much money should be deposited today in an account that earns 10.5% compounded monthly so that it will accumulate to $22,000 in four years? Round up to the nearest cent.

• $392.48

• $14,481.47

• $11,251.62

• $1,287.87

To offer scholarship funds to children of employees, a company invests $10,000 at the end of every three months in an annuity that pays 10.5% compounded quarterly. How much will the company have in scholarship funds at the end of ten years? Round up to the nearest dollar.

• $516,227

• $203,393

• $693,031

At age 25, to save for retirement, you decide to deposit $75 at the end of each month in an IRA that pays 6.5% compounded monthly. How much will you have from the IRA when you retire at age 65? Round up to the nearest dollar.

• $171,271

• $135,271

• $201,056

• $151,235

a loan of $2,040 has been made at 7.5% for four months. Find the loan's future value.

• $5,010

• $1,235

• $2,091

• $2,040