1000 is deposited into Fund X, which earns an annual effective rate of 6%. At the end of each year, the interest earned plus an additional 100 is withdrawn from the fund. At the end of the tenth year, the fund is depleted. The annual withdrawals of interest and principal are deposited into Fund Y, which earns an annual effective rate of 9%.

Calculate the accumulated value of Fund Y at the end of year 10.

• 1519
• 1819
• 2085
• 2273
• 2431

A 20-year loan of 1000 is repaid with payments at the end of each year. Each of the first ten payments equals 150% of the amount of interest due. Each of the last ten payments is X. The lender charges interest at an annual effective rate of 10%.

Calculate X.

• 32
• 57
• 70
• 97
• 117

A 10-year loan of 2000 is to be repaid with payments at the end of each year. It can be repaid under the following two options

• Equal annual payments at an annual effective interest rate of 8.07%
• Installments of 200 each year plus interest on the unpaid balance at an annual effective interest rate of i.

The sum of the payments under option (i) equals the sum of the payments under option (ii).

Calculate i.

• 8.75%
• 9.00%
• 9.25%
• 9.50%
• 9.75%

A loan is amortized over five years with monthly payments at an annual nominal interest rate of 9% compounded monthly. The first payment is 1000 and is to be paid one month from the date of the loan. Each succeeding monthly payment will be 2% lower than the prior payment.

Calculate the outstanding loan balance immediately after the 40^th payment is made.

• 6750
• 6890
• 6940
• 7030
• 7340

Seth, Janice, and Lori each borrow 5000 for five years at an annual nominal interest rate of 12%, compounded semi-annually. Seth has interest accumulated over the five years and pays all the interest and principal in a lump sum at the end of five years. Janice pays interest at the end of every six-month period as it accrues and the principal at the end of five years. Lori repays her loan with 10 level payments at the end of every six-month period.

Calculate the total amount of interest paid on all three loans.

• 8718
• 8728
• 8738
• 8748
• 8758

Ron is repaying a loan with payments of 1 at the end of each year for n years. The annual effective interest rate on the loan is i. The amount of interest paid in year t plus the amount of principal repaid in year t + 1 equals X.

Determine which of the following is equal to X.

• [math]1 + \frac{v^{n-t}}{i}[/math]
• [math]1 + \frac{v^{n-t}}{d}[/math]
• [math]1 + v^{n-t}i[/math]
• [math]1 + v^{n-t}d[/math]
• [math]1 + v^{n-t}[/math]

Seth borrows X for four years at an annual effective interest rate of 8%, to be repaid with equal payments at the end of each year. The outstanding loan balance at the end of the third year is 559.12.

Calculate the principal repaid in the first payment.

• 444
• 454
• 464
• 474
• 484

Happy and financially astute parents decide at the birth of their daughter that they will need to provide 50,000 at each of their daughter’s 18th , 19th , 20th and 21st birthdays to fund her college education. They plan to contribute [math]X[/math] at each of their daughter’s 1 st through 17th birthdays to fund the four 50,000 withdrawals. They anticipate earning a constant 5% annual effective interest rate on their contributions.

Let v = 1/1.05

Determine which of the following equations of value can be used to calculate [math]X[/math].

• [[math]]X\sum_{k=1}^{17}\nu^{k}=50,000[\nu+\nu^{2}+\nu^{3}+\nu^{4}][[/math]]
• [[math]]X\sum_{k=1}^{16}1.05^{k}=50,000\left [1+\nu+\nu^{2}+\nu^{3}\right][[/math]]
• [[math]]X\sum_{k=0}^{17}1.05^{k}=50,000\left [1+\nu+\nu^{2}+\nu^{3}\right][[/math]]
• [[math]]X\sum_{k=1}^{17}1.05^{k}=50,000[1+\nu+\nu^{2}+\nu^{3}] [[/math]]
• [[math]] X\sum_{k=0}^{17}\nu^{k}=50,000[\nu^{18}+\nu^{19}+\nu^{20}+\nu^{21}+\nu^{22}][[/math]]

You are given the following information about a loan of L that is to be repaid with a series of 16 annual payments:

• The first payment of 2000 is due one year from now.
• The next seven payments are each 3% larger than the preceding payment
• From the 9th to the 16th payment, each payment will be 3% less than the preceding payment.
• The loan has an annual effective interest rate of 7%.

Calculate L.

• 20,689
• 20,716
• 20,775
• 21,147
• 22,137

Tanner takes out a loan today and repays the loan with eight level annual payments, with the first payment one year from today. The payments are calculated based on an annual effective interest rate of 4.75%. The principal portion of the fifth payment is 699.68.

Calculate the total amount of interest paid on this loan.

• 1239
• 1647
• 1820
• 2319
• 2924