BUSINESS MATH

SIMPLE INTEREST

LEARNING OBJECTIVE FOR QUESTION #1 IS:

• Learning Objective

  07-03 Calculate the equivalent value on any date of a single payment or a stream of payments

LEARNING OBJECTIVE FOR QUESTION #2

• Learning Objective

  07-01 Calculate interest, maturity value (future value), present value, rate, and time in a simple interest environment

PLEASE ANSWER CORRECTLY.

Payments of $4,000, due 60 days ago, and $4,500, due in 50 days, are to be replaced by payments of $4,400 due today and the balance due in 40 days. What must the second payment be if the payee is to end up in an equivalent financial position? Money now earns 8.95%. Use 40 days from now as the focal date. (Use 365 days a year. Do not round intermediate calculations and round your final answer to 2 decimal places.) Second payment What annual rate of interest was earned if a $22,000 investment for four months earned $667.33 in interest? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Interest rate % per annum