1) William has saved $560 per quarter for the last three years in a savings account earning 5.2% compounded quarterly. He plans to leave the accumulated savings for seven years in the savings account at the same rate of interest.
a) How much will be in total in the savings account?
b) How much did he contribute?
c) How much interest in total did he earn?
2) An installment contract for the purchase of a car requires payments of $252.17 at the end of each month for the next three years. Suppose interest is 8.4% compounded monthly.
a) What is the amount financed?
b) How much interest is paid?
3) What payment is required at the end of each month for five years to repay a loan of $8000 at 8.4% compounded monthly?
4) Ronald bought a used car at a price of $15,300 for 15% down and equal monthly payments for four years. If interest is 8% compounded monthly, what is the size of the monthly payments?
5) A mortgage of $26,500 is to be repaid by making payments of $1560 at the end of every six months. If interest is 7% compounded semi-annually, what is the term of the mortgage?
6) Chris saves $20 at the end of each week and deposits the money into a savings account earning 4% compounded monthly.
a) How much will she accumulate in 10 years?
b) How much of the accumulated amount is interest?
7) Jennifer has made deposits of $950 at the end of every six months for 15 years. If interest is 3% compounded monthly, how much will Jennifer have accumulated ten years after the last deposit?(6 marks)) What is the discounted value of $1560 paid at the end of each year for nine years if interest is 6% compounded quarterly?(4 marks)
8) You have been offered a two-year salary deal. You can either accept $2,000,000 now or accept monthly amounts of $100,000 payable at the end of each month. If money can be invested at 5.7% compounded quarterly, evaluate each option and determine which is better for you and by how much?
9) What payment is required at the end of each month for 5 years to repay a loan of $6000 at 7% compounded semi-annually?