Reference no: EM133208303 , Length: Word count: 2 Pages

Question 1) Solve: 4/3(5x - 2) - 3/5(16x - 3) = 17/60 + 3x

Question 2) A residential property is assessed for tax purposes at 45% of its market value. The residential property tax rate is 3 2/3% of the assessed value and the tax is $1300.

a) What is the assessed value of the property?

b) What is the market value of the property?

Question 3) A retail store realizes a gross profit of $62.67 if it sells an article at a margin of 32% of the selling price.

a)  What is the regular selling price?

b)  What is the cost?

c)   What is the rate of markup based on cost?

d)  If overhead is 21% of cost, what is the break-even price?

e)   If the article is sold at a markdown of 25%, what is the operating profit or loss?

Question 4) What sum of money will accumulate to $1426.80 in eight months at 7.78%?

Question 5) The owner of Easy Clips borrowed $8800.00 from Red Deer Community Credit Union on June 17. The loan was secured by a demand note with interest calculated on the daily balance and charged to the store's account on the 5th day of each month. The loan was repaid by payments of $2500.00 on July 25, $2300.00 on October 17, and $3500.00 on December 30. The rate of interest charged by the credit union was 6.5% on June 17. The rate was changed to 6.65% effective July 1 and to 6.95% effective November 1. Determine the total interest cost on the loan, up to and including Dec. 30.

Question 6) An investment of $21 700 is accumulated at 5.24% compounded quarterly for three and one-half years. At that time the interest rate is changed to 6.12% compounded monthly. How much is the investment worth two years after the change in interest rate?

Question 7) Determine the maturity value of $5400 due in 91 months compounding annually at 8.75%.

Question 8) If the effective rate of interest on an investment is 7%, what is the nominal rate of interest compounded quarterly?

Question 9) Calculate the nominal annual rate of interest compounded quarterly that is equivalent to 10% p.a. compounded semi-annually.

Question 10) Yankee Construction agreed to lease payments of $762.79 on construction equipment to be made at the end of each month for six years. Financing is at 15% compounded monthly.

a) What is the value of the original lease contract?

b) If, due to delays, the first eight payments were deferred, how much money would be needed after nine months to bring the lease payments up to date?

c) How much money would be required to pay off the lease after nine months?

d) If the lease were paid off after nine months, what would the total interest be?

e) How much of the total interest would be due to deferring the first eight payments?

Question 11) A car was purchased for $4500.00 down and payments of $375.00 at the end of each month for 5 years. Interest is 9.72% compounded monthly.

a) What was the purchase price of the car?

b) How much will be the amount of interest paid?

Question 12) What sum of money can be withdrawn from a fund of $46 950.00 invested at 6.5% compounded semi-annually at the end of every three months for twelve years?

Question 13) Sean Paul borrowed $20 000.00 from his father to finance his new business. The loan agreement calls for equal payments at the end of each month for 10 years. The payments are deferred for 4 years and interest is 4.00% compounded semi-annually. What is the size of the monthly payments?

Question 14) A contractor's price for a new building was $85 100.00. Stampede Inc., the buyers of the building, paid $14 000.00 down and financed the balance by making equal payments at the end of every six months for 14 years. Interest is 12% compounded semi-annually.

a)  What is the size of the semi-annual payment?

b) How much will Stampede Inc. owe after 6 years?

c)  What is the total cost of the building for Stampede Inc.?

d) What is the total interest included in the payments?

Question 15) Bonds in denominations of $10 000 redeemable at par in six years and four months are offered for sale. If the coupon rate is 6.5% payable quarterly and the expected yield is 8% compounded quarterly, determine

a)  the market price;

b) the accrued interest;

c)  the cash price.

Tamia Industries plans to replace the outdated equipment that will cost the company $100 000.00 now and $60 000.00 six years from now. This replacement will result in revenues of $6000.00 at the end of each quarter for twelve years. At an interest rate of 9% compounded annually and using the Net Present Value criterion, should the company replace this equipment or not?