Part 1 Quiz

1. Mary owes June $800, and wants to pay her off. She decides to borrow the amount from her

bank at a discount rate of 12%. If she borrows the money for 10 months, find the amount of the

loan she should ask for so that her proceeds are $800?

2. Lydia's aunt Rose left her $4,000. Lydia spent $1,000 on her wardrobe and deposited the rest in

an account that pays 8.9% compounded daily. How much money will she have in 5 years?

3. At the end of each month Rita deposits $600 in an account that pays 4% compounded monthly.

What will the final amount be in 3 years?

4. The Gomez family bought a house for $250,000. They paid 15% down and amortized the rest at

11.2% over a 30-year period. Find their monthly payment.

5. Mr. Smith is planning to retire in 30 years and would like to have $350,000 then. What monthly

payment made at the end of each month to an account that pays 7.5% compounded monthly

will achieve his objective?