Unit 7 Practice Test (Part Two)

What error did Missy make when setting up the formula for calculating the amount on a loan with the given parameters?

• The interest rate should be 0.325

• The monthly interest rate should not be added to 1 in the parentheses

• The exponent does not take into account the frequency of compounding

• The interest rate should not be divided by 12

What is the interest rate applied to the loan principal of $1,000 as shown in the amortization table?

• 22.93%

• 5.8%

• 24%

• 18.50%

According to the amortization table, what is the total interest paid after 4 monthly payments?

• $4803.39

• $2000.00

• $1530.31

• $6840.18

Tags

CCSS.HSF.LE.A.2

What is the remaining balance after the first monthly payment as per the amortization table?

• $964.44

• $14907.37

• $19248.41

• $1324.88

Tags

CCSS.HSF.LE.A.2

1. Jay’s store credit card offers a special financing program.  The fine print states that if he does not pay his balance in full in 3 years, he will have to pay interest on his original purchase balance at 21.43% APR compounded daily.

If Jay does not pay his balance in full within 3 years for a $3100 TV purchase, what will his balance be?

• $3298.21

• $4758.23

• $6522.35

• $8924.21

If a car loan is offered at an APR of 6.25% compounded monthly, what is the APY rounded to the nearest hundredth of a percent?

• 6.43%

• 6.25%

• 5.95%

• 6.50%

What is Tareq's monthly interest rate if he has a $16,000 auto loan with a 4.5% annual interest rate, compounded monthly?

• 4.5%

• 0.45%

• 0.0054%

• 0.375%

What would be the balance of Tareq's loan after the first month if he starts with $15,000 at 3.14% compounded monthly and makes a payment of $285?

• $14,715.12

• $14,754.25

• $14,715.67

• $14,715.90

What is the initial loan principal amount according to the table?

• $14,907.47

• $15,000.00

• $19,803.39

• $4,803.39

Tags

CCSS.HSF.LE.B.5

What is the monthly payment amount for the loan?

• $165.03

• $49.06

• $72.50

• $93.88

Tags

CCSS.8.EE.C.7B