PART II: Multiple Choices Questions: Circle the correct answer (4 points each, 4

Question

PART II: Multiple Choices Questions: Circle the correct answer (4 points each, 40 points total) 1. How many years? will it take to pay off a $2000 debt, with semiannually payments of $100 at the end of every month's period, if the interest is 6%/year, compounded semi-annually. A) 15.5 B) 62 C) 18.5 D)16 E) 31 F) no answer 2. If you deposit $5000 in a bank that paid interest of 6%/year, compounded monthly. Then the total sum of money by the end of year 3 is most nearly. -1-A)/5900 B) 4900 C)6000 D)6500 3. You deposit $1000/year at the beginning of each year for the next 5 years. However, you do not E) 7900 F) no answer withdraw your money until the end of year 7. If you can earn 10% of interest/year, the total sum of your money at the end of year 7 is most nearly. A) 8125 B) 7540 c) 5225 D) 6520 E) 8000 F) no answer FIU recently spent $200,000 to improve the landscaping areas around the main campus. All landscaping areas need to be re-enhanced every 10 years at the cost of $100,000. We assume that this project will last forever n-inf. Ifi: 10%, then the initial budget that needs to be allocated for re- enhancing the landscaping areas every 10 years should be most nearly. A) 238550 4. B) 614500 C) 38550 D) 627000 E) 600000 F) no answer

Explanation / Answer

MAKE THE FINAL REPORT FILES DIRECTLY FOR FCCM

1.

=NPER(6%/2,-100,2000)

=30.99891276 periods

=30.99891276

/2 years

=15.5 years

Option A

2.

=FV(6%/12,12*3,0,5000)

=$5,983.40

Option C

3.

=FV(10%,2,0,FV(10%,5,1000,0,1))

=$8,125.89

Option A

4.

=(100000/1.1^10)/(1-1/1.1^10)

=62745.39488

Option D

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