# https://assessment.casa.uh.edu/assessment/printtest.htm PRINTABLE VERSION Quiz 4

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1 1 of 6 2/21/2013 8:18 AM PRINTABLE VERSION Quiz 4 Question 1 Luke invested \$130 at 4% simple interest for a period of 7 years. How much will his investment be worth after 7 years? a) \$ b) \$ c) \$ d) \$ e) \$ Question 2 Mr. Smith wishes to retire in 13 years. When he retires he would like to have \$300,000 in his bank account. Mr. Smith's bank pays 8% per year compounded annually. How much should he deposit now to attain his goal? a) \$110, b) \$110, c) \$110, d) \$110, e) \$110, Question 3 A grandmother deposited \$5,000 in an account that pays 6% per year compounded annually when her granddaughter was born. What will the value of the account be when the granddaughter reaches her 10 th birthday? a) \$8,974.24

2 2 of 6 2/21/2013 8:18 AM b) \$8, c) \$8, d) \$8, e) \$8, Question 4 In order to purchase a new freezer in 2 years, the Steakhouse Restaurant has decided to deposit \$1,500 in an account that earns 3% per year compounded monthly for 2 years. How much money will be in the account in 2 years? a) \$1, b) \$1, c) \$1, d) \$1, e) \$1, Question 5 Stor-Away Co. needs to buy a new forklift. The company decides to deposit \$2,300 in an account that earns 2% per year compounded semiannually. How much will the investment be worth in 4 years? a) \$2, b) \$2, c) \$2, d) \$2, e) \$2, Question 6 John wishes to set up an account for his grandfather so that he can have some extra money each month. John wants his grandfather to be able to withdraw \$110 per month for the next 2 years. How much must

3 3 of 6 2/21/2013 8:18 AM John invest today at 6% per year compounded monthly so that his grandfather can withdraw \$110 per month for the next 2 years? a) \$2, b) \$2, c) \$2, d) \$2, e) \$2, Question 7 John got a part time weekend job at a local restaurant to save for a new car. He plans on depositing \$190 per month for the next 3 years in a savings account with a rate of 3% per year compounded monthly. How much will he have saved toward his down payment at the end of the 3 year period? a) \$7, b) \$7, c) \$7, d) \$7, e) \$7, Question 8 Fred purchased a new car. His monthly payments are \$550 per month. He will be paying on his car for 5 years, and the loan costs 9% per year compounded monthly. What was the original cost of the car? a) \$26, b) \$26, c) \$26, d) \$26, e) \$26,495.36

4 4 of 6 2/21/2013 8:18 AM Question 9 Jackson deposits \$110 each month into a savings account earning interest at the rate of 7% per year compounded monthly. How much will he have in this account at the end of 6 years? a) \$9, b) \$9, c) \$9, d) \$9, e) \$9, Question 10 Esther pays \$467 per month for 6 years for a car. She made a down payment of \$3,700. If the loan costs 7.1% per year compounded monthly, what was the cash price of the car? a) \$31, b) \$45, c) \$23, d) \$27, e) \$38, Question 11 You borrowed \$13,000 from your bank to build a small cabin on your property. The bank will charge 7% per year compounded quarterly. You decide to payoff this loan in 3 years by making quarterly payments. How much are your quarterly payments? a) \$1, b) \$1, c) \$1, d) \$1, e) \$1,210.48

5 5 of 6 2/21/2013 8:18 AM Question 12 Your brother would like to have \$27,000 in 2 years for the purchase of a new car. What monthly payment should he make into an account paying 6% per year compounded monthly to attain his goal? a) \$1, b) \$1, c) \$1, d) \$1, e) \$1, Question 13 A school realizes that they need a new copy machine for their main office. The copy machine costs \$4,500. After speaking with the financial advisor, they decide to pay 10% of the cost of the machine in cash and finance the rest through their credit union. How much is their monthly payment if the credit union will charge 2% per year compounded monthly for 2 years? a) \$33.44 b) \$ c) \$ d) \$ e) \$23.44 Question 14 The Flores Family loves to go sailing on the weekends. Mr. Flores has decided to purchase a more spacious sailboat. The sailboat he is interested in buying in 2 years will cost him \$20,000. An account at Invest Well Bank earns 6% per year compounded monthly. How much should Mr. Flores deposit in this account at the beginning of each month to be able to pay cash for the sailboat in 2 years? a) \$ b) \$747.06

6 6 of 6 2/21/2013 8:18 AM c) \$ d) \$ e) \$786.41

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