12 MAG Finance Revision

To show the actual interest rate of an interest rate with quarterly compounding periods, the equation would look like...

To buy the brand new Hyundai i40, Mr. Poore saves up $10,000. If he places it into an account that returns 5% per annum compounding annually, how much will he acquire in 10 years?

• $16,288

• $17,164

• $14,659

• $15,978

Determine the amount after 6 years if $3200 is compounded quarterly at 10.7%. Round to the nearest cent

(a)  

You made monthly payments of $400 into an annuity for 12 years and the annuity has a balance of $80,730.00 Calculate the total interest on the annuity.

• $57,600

• $23,130

• $36,490

• $9,742

At the end of each 3 months a company will deposit $75,000 for 10 years in a depreciation fund to provide a replacement of machinery at the end of 10 years. Find the total number of payments.

• 13

• 30

• 40

• 750,000

Which one of the following recurrence relations will generate the sequence 4, 6, 10?

An investment of $10000 will earn compound interest at the rate of 2.16% per annum, compounding quarterly.

Which one of the follow recurrence relations can be used to model A_n, the value of the investment after n quarters?

Consider the graph and select the correct option below:

• Blue dots represent balance with simple interest

• Blue dots represent balance with compound interest

• Red crosses represent balance with compound interest

• None of the above

A reducing-balance loan of $8000 will be repaid with quarterly payments. The repayment schedule for this loan is shown below. Find the annual percentage interest rate

(a)