An investment of 1000 accumulates to 1200 at the end of 4 years. If the force of interest is 1.25δ during the first two years and δ during the next two years, find the equivalent effective annual interest rate i for the first year.
- 0.036
- 0.04
- 0.048
- 0.052
- 0.062
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
What is the value of
- [[math]](1+i)^{2 / m}[[/math]]
- [[math]]\frac{i^{(m)} d^{(m)}}{m}[[/math]]
- [[math]]1-\frac{i^{(m)} d}{m}[[/math]]
- [[math]]\left(1-\frac{d^{(m)}}{m}\right)^2[[/math]]
- [[math]]1 [[/math]]
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
How many years will it take to double your money if you invest an amount A now at a nominal rate of 4% compounded semiannually?
- 17
- 17.5
- 17.7
- 18
- 18.5
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
Money accumulates in a fund at an effective annual interest rate of i during the first three years and at an effective annual interest rate of 3i thereafter. A deposit of 100 is made into a fund at time 0. It accumulates to 178.66 at the end of 10 years and to 368.21 at the end of 20 years.
What is the value of the fund at the end of 8 years?
- 122
- 135
- 155
- 162
- 178
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
In Fund X money accumulates at force of interest [math]\delta_t=.01 t+.10[/math], for [math]0 \lt t\lt 20[/math]. In Fund Y money accumulates at annual effective rate [math]i[/math]. An amount of $1 is invested in each fund, and the accumulated values are the same at the end of 20 years. Find the value in Fund Y at the end of 1.5 years.
- 1.3
- 1.32
- 1.35
- 1.37
- 1.4
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
Eric deposits X into a savings account at time 0, which pays interest at a nominal rate of i, compounded semiannually. Mike deposits 2X into a different savings account at time 0, which pays simple interest at an annual rate of i. Eric and Mike earn the same amount of interest during the last 6 months of the 8th year.
Calculate i.
- 0.095
- 0.1
- 0.125
- 0.127
- 0.131
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
Simplify the expression
- [math]-v[/math]
- [math]-v^3[/math]
- 1
- [math]v[/math]
- [math]v^3[/math]
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
How long does it take for a fund to grow to four times its original value if growing at an annual rate of 7%?
- 7
- 10.25
- 16.24
- 20.5
- 28
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
The nation of F has a unit of currency called the F. In the coming year in F, inflation is expected to be huge, 100%. Canada’s expected inflation rate for the same year is 14%. An investor in Canada can make an interest rate of 18%.
What must be the interest rate in F to be equivalent to the rate in Canada?
- 0.95
- 1
- 1.03
- 1.07
- 1.15
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.
Kathryn deposits 100 into an account at the beginning of each 4-year period for 40 years. The account credits interest at an annual effective interest rate of i. The accumulated amount in the account at the end of 40 years is X, which is 5 times the accumulated amount in the account at the end of 20 years.
Calculate X.
- 4695
- 5070
- 5445
- 5820
- 6195
References
Hlynka, Myron. "University of Windsor Old Tests 62-392 Theory of Interest". web2.uwindsor.ca. Retrieved November 23, 2023.