1- Kurt rents a house for $430 a month; he could buy the house for $50,000. If he buys the house, the down

payment is 20%, which he would withdraw from a savings account where it earns 4.5% interest. He

estimates other home ownership expenses to be $5,000 a year, and that he would save $1,450 in income

taxes. What is the net cost of owning the house for one year?

a. $4,112.50

b. $6,000

c. $4,000

d. $5,887.50

2- Kurt rents a house for $430 a month; he could buy the house for $50,000. If he buys the house, the down

payment is 20%, which he would withdraw from a savings account where it earns 4.5% interest. He

estimates other home ownership expenses to be $5,000 a year, and that he would save $1,450 in income

taxes. Is it cheaper for Kurt to own or to rent, and by how much?

a. $1,047.50 cheaper to own

b. $1,160 cheaper to own

c. $300 cheaper to rent

d. $187.50 cheaper to rent

3- In the first three months of the year, Lee used 16,400 cu ft of water. She pays a quarterly charge of $0.75

per 100 cu ft for the first 8,000 cu ft used, and $0.65 per 100 cu ft for all cu ft over 8,000 cu ft She also pays

5% tax on the total charge for water. What was her total water bill?

a. $129.15

b. $119.93

c. $120.75

d. $120.33

4- In the first three months of the year, Lee used 16,400 cu ft of water. She pays a quarterly charge of $0.75

per 100 cu ft for the first 8,000 cu ft used, and $0.65 per 100 cu ft for all cu ft over 8,000 cu ft She also pays

5% tax on the total charge for water. What was she charged for the total cubic ft. of water used?

a. $106.60

b. $114.60

c. $115.00

d. $123.00

5- Kurt rents a house for $430 a month; he could buy the house for $50,000. If he buys the house, the down

payment is 20%, which he would withdraw from a savings account where it earns 4.5% interest. He

estimates other home ownership expenses to be $5,000 a year, and that he would save $1,450 in income

taxes. What is the gross cost of owning the house for one year?

a. $5,450

b. $4,550

c. $4,437.50

d. $5,562.50

6- You buy a car for $12,000 cash. Expenses for the first year are: gas and oil, $1,200; repairs, $300;

insurance, $400; license, $200; loss of interest on investment, $600; and depreciation, 10% of the purchase

price. What is the average cost per mile of operating your car if you drove 30,000 miles during your first

year?

a. $0.094

b. $0.09

c. $0.13

d. $0.53

7- In the first three months of the year, you used 15,900 cu ft of water. You pay a quarterly charge of $0.60 per

100 cu ft for the first 10,000 cu ft used, and $0.55 per 100 cu ft for all cu ft over 10,000 cu ft used. You also

pay 6% tax on the total charge for water. What is your charge for the total cu ft of water used?

a. $95.40

b. $90.40

c. $92.45

d. $87.45