Business Math Exam 3 Quiz Questions with Complete Solutions
Ms. Bolton invests $6000 into an account earning 7% per year simple interest. How many years will it take for the future value to become $7134? (round to one decimal place) - ANSWER-1.1 years Solution A = 7134 P = 6000 r = .07 t = t 1) 7134 / 6000 2) 1.189 / 1 + .07 = 1.1 Bryce wants to put money in a savings account now so that he will have $1800 in 5 years. The savings bank pays 6% interest compounded quarterly. How much should he invest? - ANSWER-$561.25 Solution m = 4 t = 5 N = 4 * 5 I = 6 PV = PV PMT = 0 FV = 1800 P/Y = m = 4 On her 32nd birthday, Ms. Eaton deposits $5,000 in an account that pays 5.6% compounded daily. How much will be in her account on her 40th birthday if she makes no more deposits or withdrawals? - ANSWER-$7825.62 Solution m = 365 t = 8 N = 365 * 8 I = 5.6 PV = -5000 PMT = 0 FV = FV P/Y = m = 365
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