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Exam 6: Simple Interest

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Question 41

Multiple Choice

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A 9-month term deposit, earning interest at 7%, was worth $72,559 when it reached maturity today. How much had been invested at the beginning of the term?

A) $76,368
B) $68,940
C) $72,552
D) $67,480
E) $70,000

F) None of the above
G) All of the above

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Question 42

Multiple Choice

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Payments of $7,000 120 days ago and $3,000 90 days ago are to be replaced by $4,500 60 days from now and a final payment 240 days from now. If interest is 5.95% annually, determine the value of the final payment.

A) $4,851.61
B) $4,926.86
C) $5,424.38
D) $5,727.60
E) $5,940.14

F) A) and E)
G) B) and C)

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Question 43

Multiple Choice

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At what simple annual interest rate would $835 grow to $900 in 5 months?

On June 26, 2013, $1000 was borrowed at an interest rate of 10.75%. On what date was the loan repaid if the amount of accrued interest was $63.91?

Two payments of $1,300 and $1,800 were scheduled to be paid five months ago and three months from now, respectively. The $1,300 payment has not yet been made. What single payment at a focal date one month from now would be equivalent to the two scheduled payments if money can earn 4.5 %?

What amount paid on September 24 is equivalent to $1,000 paid on the following December 1 if money can earn 3%?

Judith received the proceeds from an inheritance on March 25. She wants to set aside enough on March 26 so that she will have $20,000 available on October 1 to purchase a car when the new models are introduced. If the current interest rate on 181 to 270-day term deposits is 3.75%, what amount should she place in the term deposit?

A payment of $590 is now 93 days overdue. A second payment of $955 will be due and payable in 200 days. If money can earn an interest rate of 11%, what single amount, paid in 30 days, will be an equivalent replacement payment?

An $8,000 loan at an interest rate of 6.5% is to be repaid in three equal payments at six months, nine months, and one year later. Determine the size of the equal payments.

A $10,000 loan made on January 1 at 7%, is to be repaid by payments of $3,500 on July 1, $3,500 on October 1, and a final payment on January 1 of the next year. What is the amount of the final payment required to pay off the loan in full?

Maia's chequing account was $329 overdrawn beginning on September 24. On October 9 she made a deposit that restored a credit balance. If she was charged overdraft interest of $2.50, what annual rate of simple interest was charged?

What simple interest rate was used if Rocco charged Squirrel $350 interest on a loan of $2,000 for 41 days?

A loan of $4,000 at 13% is to be repaid by three equal payments due four, six, and eight months after the date on which the money was advanced. Calculate the amount of each payment.

Indira paid interest charges of $169.05 on a $4830 invoice that was two months overdue. What monthly rate of simple interest was she charged?

If the maturity value of an investment which paid 13.9% was $400,000 after 7 months, how much of that amount was interest?

On what date did a corporation borrow $350,000 at 7.5% from its bank if the debt was settled by a payment of $356,041 on February 28?

The original $3,000 loan was advanced on March 1. The loan is to be repaid by the three indicated payments. Calculate the unknown payment in each case. Use the loan date as the focal date.

Calculate the maturity value of an investment of $22,500 after 9 months at 13.45%.

Mr. and Mrs. Chan are considering two offers on a building lot that they own in a nearby town. One is for $49,000, consisting of $10,000 down and the balance to be paid in a lump payment in eight months. The second is for $50,000, with $10,000 down and the balance to be paid in 1 year. What rate of return must money earn for Mr. and Mrs. Chan to be indifferent between the two offers?

$180 is to be paid now. What amount would be equivalent 3 quarters earlier given an interest rate of 6.8% per year?