If you can’t see the graph for #5, just skip. For whatever reason I’m having a bit of an issue with… Show more If you can’t see the graph for #5, just skip. For whatever reason I’m having a bit of an issue with those! 🙁 QUESTION 1 Your credit card charges a 21% nominal annual interest rate on unpaid balances. If interest is compounded continuously, the effective annual interest rate = a. 1.75% b. 21.0% c. 23.1% d. 23.4% QUESTION 2 You plan to spend $300 for gasoline in February, $350 in March, and $400 in April. If this is January, the present worth of your planned gasoline purchases can be found by which formula if the interest rate = ½% per month? a. P = 50(P/G,½%,3) b. P = 300(P/G,½%,3)(50(A/G,½%,3) c. P = 300(P/A,½%,3) + 50(P/G,½%,3) d. P = 300(P/G,½%,3) QUESTION 3 You plan to spend $300 for gasoline in February, $350 in March, and $400 in April. If this is January, the present worth of your planned gasoline purchases can also be found by which formula if the interest rate = ½% per month? a. P = 1050(1.005) 3 b. P = 300 + 350(1.005) + 400(1.005) 2 c. P = 300(1.005) + 350(1.005) 2 + 400(1.005) 3 d. P = 300(1.005) -1 + 350(1.005) -2 + 400(1.005) -3 QUESTION 4 Your credit card charges a 21% nominal annual interest rate on unpaid balances. If interest is compounded daily, the effective annual interest rate = a. 1.75% b. 21.0% c. 23.1% d. 23.4% 1 points QUESTION 5 Based on this cash flow diagram, what is a correct specification? (added to bottom maybe?) a. X = 20(P/A,6%,4)(P/F,6%,4) + 20(P/G,5%,4) b. X = 20(P/A,4%,6) + 20(P/G,4%,4) c. X = 20(P/A,6%,4) + 20(P/G,6%,4) d. X = 20(P/G,6%,4) QUESTION 6 You plan to spend $300 for gasoline in February, $350 in March, and $400 in April. If this is January and monthly interest is 1/2%, the present worth of your planned gasoline purchases = a. $742 b. $758 c. $1039 d. $1050 QUESTION 7 You save $3000 in Year 1, $2500 in Year 2, and $2000 in Year 3. If i = 10%, which specification is NOT correct for calculating the future worth of this saving at the end of Year 3? a. F = 3000(F/A,10%,3) – 500(P/G,10%,3)(F/P,10%,3) b. F = 3000(F/A,10%,3) – 500(P/G,10%,3) c. F = 3000(F/A,10%,3) – 500(A/G,10%,3)(F/A,10%,3) d. F = 3000(F/P,10%,2) + 2500(F/P,10%,1) + 2000 QUESTION 8 You borrow $8000 at an nominal interest rate of 6%. If you repay this loan quarterly, making 4 payments per year, the effective annual rate = a. 1.5% b. 6.0% c. 6.14% d. 6.86% QUESTION 9 Which of the following is correct? a. Geometric gradients change by a constant percentage over time b. Geometric gradients change by a constant amount over time c. Geometric gradients change by a factor of (i-g) over time d. Geometric gradients are the inverse of arithmetic gradients QUESTION 10 Your credit card charges a 21% nominal annual interest rate on unpaid balances. If interest is compounded monthly, the effective annual interest rate = a. 1.75% b. 21.0% c. 23.1% d. 23.4% QUESTION 11 You plan to spend $300 for gasoline in February, $350 in March, and $400 in April. a. G = 50 b. G = 300 c. G = 400 d. G = 1050 QUESTION 12 You expect to save $3000 in Year 1, $2500 in Year 2, and $2000 in Year 3. If i = 10%, the future worth of your savings at the end of Year 3 = a. $7500 b. $7940 c. $8084 d. $8380 Maybe the graph to #5 below? • Show less