finance-how-much-will-it-grow-to-in-3-years-if-the-bank-pays-6

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If you
put $8,000 in a savings account today, how much will it grow to in 3 years if
the bank pays 6% annual interest compounded continuously?

$8,494.69

$9,440.00

$9,528.12

$9,577.74

A company
issues zero coupon bonds which mature in 30 years. These bonds can be bought
for $99.38 and then pay no annual interest payments, only $1000 at maturity.
What is the annual percentage cost of these bonds to the issuing company?

30%

17%

12%

8%

If you
can invest $10,000 at a 7% annual rate, compounded monthly, how long will it
take to have $13,050?

19 months

52 months

16 months

46 months

Which of
the following statements is not true?

The present value factor is also known as the discount factor.

The present value factor decreases as the interest rate
increases.

The present value factor is the reciprocal of the future value
factor.

The
present value factor can be greater than 1.

Aaron
earns 10% interest compounded annually on his savings. He will deposit $750
today, $825 one year from today, and $910 two years from today. What will be
the account balance three years from today?

$3006.50

$2,486.00

$2,642.50

$2,997.50

The
amount borrowed on a loan equals the

compounded value of the loan payments

sum of the loan payments

discounted value of the loan payments

future value of the loan payments

Which of
the following examples represents a growing annuity?

A 30-year mortgage.

A share of preferred stock.

A consol.

An inflation-adjusted 25-year lease.

The EAR
will equal the APR if interest is compounded

daily.

monthly.

quarterly.

annually.

Which of
the following is not a typical way in which interest rates are quoted in the
marketplace?

APR.

EAR.

Discounted interest.

The quoted interest rate.

Which of
the following interest rates will result in the highest amount of interest
being charged?

7% per year, compounded daily.

7.5% per year, compounded quarterly.

8% per year, compounded annually.

7.8% per year, compounded daily.

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