If you put up $36,000 today in exchange for a 6.20 percent, 13-year annuity, wha

Question

If you put up $36,000 today in exchange for a 6.20 percent, 13-year annuity, what will the annual cash flow be?

$3,878.69

$8,808.92

$4,114.21

$4,356.39.

$2,769.23


You are planning to make monthly deposits of $150 into a retirement account that pays 11 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 19 years?

$114,681.33

$108,947.27

$120,415.40

$1,376,176.01

$102,491.08

You're prepared to make monthly payments of $300, beginning at the end of this month, into an account that pays 6 percent interest compounded monthly.

Required:

How many payments will you have made when your account balance reaches $18,938? (Do not round your intermediate calculations.)


55

4.71

49.5

26.88

60.5


You need a 25-year, fixed-rate mortgage to buy a new home for $180,000. Your mortgage bank will lend you the money at a 6 percent APR for this 300-month loan. However, you can afford monthly payments of only $900, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment.

Required:
How large will this balloon payment have to be for you to keep your monthly payments at $900?


$187,200

$21,764.12

$40,313.82

$174,600

$180,000
You want to buy a new sports car from Muscle Motors for $47,000. The contract is in the form of a 72-month annuity due at a 6.50 percent APR.

Required:
What will your monthly payment be?

$801.53

$785.81

$770.09

$746.52

$790.07
Phil can afford $170 a month for 5 years for a car loan. If the interest rate is 5.8 percent, how much can he afford to borrow to purchase a car?

$10,200.00

$8,835.79

$9,012.50

$8,976.00

$7,637.62
You are borrowing $5,310 to buy a car. The terms of the loan call for monthly payments for 5 years at a 6.00 percent interest. What is the amount of each payment?

$97.39

$102.66

$76.11

$95.90

$75.56
MC Qu. 47Atlas Insurance wants to sell you an annuity which wi...
Atlas Insurance wants to sell you an annuity which will pay you $600 per quarter for 30 years. You want to earn a minimum rate of return of 5.0 percent. What is the most you are willing to pay as a lump sum today to buy this annuity?

$31,207.66

$37,189.71

$32,411.57

$36,893.88

$32,868.16

Explanation / Answer

1) $4,114.21 ===> 36000 = (A/0.062)( 1 - (1/1.062)^13) so A = $4,114.21 2) $108,947.27 ====> 1.11 = (1 +r) ^12 => r = 0.008734, 150 ( 1+r) ((1+r)^19*12 -)/r =$108,947.27 3) 55 4) $180,000 5) $785.81 6)$8,835.79 7)$102.66 8) $37,189.71

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