Part 1 (16 points) 1. (1 point) If you wish to accumulate $145,000 in 13 years, how much must you deposit today in an account that pays an annual interest rate of 8.75%? Round to the nearest $0.01. 2. (1 point) What will $117,000 grow to be in 18 years if it is invested in an account with an annual interest rate of 5.25%? Round to the nearest $0.01. 3. (1 point) How many years will it take for $100,000 to grow to $500,000 if it is invested at an annual interest rate of 10.00%? Round to the nearest 0.01. 4. (1 point) You are offered a line of credit with a quoted interest rate of 30% with daily compounding. What is your effective annual interest rate? Round to the nearest 0.01%. 5. (1 point) You are told that if you invest $5,000 per year for 35 years you will have accumulated $1,000,000. What is the annual rate of return on the latter investment? Round to the nearest 0.01%. 6. (1 point) You plan to purchase a car that costs $42,100. You deposit a down payment of $4,000 and finance the remaining amount over a period of 5 years. Your quoted annual rate is 9.30% compounded monthly. What will your monthly car payment be? Round to the nearest $0.01. 7 (1 point) How much must you donate today if you wish to establish a scholarship of $10,000 per year, forever? Assume the proceeds can remain invested at an annual interest rate of 3.50%. Round to the nearest $0.01. 8. (9 points) Complete the table below. Assume an investment of $10,000 is made today and is expected to earn a quoted interest rate of 8.20%. Find the future value of after 5 years (Column B), 25 years (Column C), and 45 years (Column D) at each compounding frequency in Column A (annual, monthly, daily). (A) (B) (C) (D) Frequency (m) FV (5 Years) FV (25 Years) FV (45 Years) 1 12 365

2 Part II (20 points): Personal Finance 1. (10 points) You decide to purchase a home priced at $350,000.00 with a 10% down payment. The mortgage lender approves you for a 30-year loan at a quoted interest rate of 5.75% that will be repaid monthly. Complete the full amortization table with the following 5 columns: beginning period balance, monthly payment, interest paid, principal paid, and ending period balance. 2. (10 points) You decide to purchase a car retailing at MSRP for $33,750.00. The car dealer gives you a $1,500.00 discount and you decide to deposit $5,400.00 as a down payment. The dealers financing company approves you for a 5-year loan at a quoted interest rate of 7.20% that will be repaid monthly. Complete the full amortization table with the following 5 columns: beginning period balance, monthly payment, interest paid, principal paid, and ending period balance.