51. Whatâ??s the present value of $4,500 discounted back 5 years if the appropriate interest rate is

51. Whatâ€™s the present value of $4,500 discounted back 5 years
if the appropriate interest rate is 4.5%, compounded semiannually?

a. $3,089
b. $3,251
c. $3,422
d. $3,602
e. $3,782

52. Whatâ€™s the future value of $1,200 after 5 years if the
appropriate interest rate is 6%, compounded monthly?

a. $1,537.69
b. $1,618.62
c. $1,699.55
d. $1,784.53
e. $1,873.76

53. Whatâ€™s the present value of $1,525 discounted back 5 years
if the appropriate interest rate is 6%, compounded monthly?

a. $969
b. $1,020
c. $1,074
d. $1,131
e. $1,187

54. Master Card and other credit card issuers must by law print
the Annual Percentage Rate (APR) on their monthly statements. If the APR is stated to be 18.00%, with
interest paid monthly, what is the card’s EFF%?

a. 18.58%
b. 19.56%
c. 20.54%
d. 21.57%
e. 22.65%

55. Riverside Bank offers to lend you $50,000 at a nominal rate
of 6.5%, compounded monthly. The loan
(principal plus interest) must be repaid at the end of the year. Midwest Bank also offers to lend you the
$50,000, but it will charge an annual rate of 7.0%, with no interest due until
the end of the year. How much higher or
lower is the effective annual rate charged by Midwest versus the rate charged
by Riverside?

a. 0.52%
b. 0.44%
c. 0.36%
d. 0.30%
e. 0.24%

56. Suppose Community Bank offers to lend you $10,000 for one
year at a nominal annual rate of 8.00%, but you must make interest payments at
the end of each quarter and then pay off the $10,000 principal amount at
the end of the year. What is the
effective annual rate on the loan?

a. 8.24%
b. 8.45%
c. 8.66%
d. 8.88%
e. 9.10%

57. Suppose a bank offers to lend you $10,000 for 1 year on a
loan contract that calls for you to make interest payments of $250.00 at the
end of each quarter and then pay off the principal amount at the end of
the year. What is the effective annual
rate on the loan?

a. 8.46%
b. 8.90%
c. 9.37%
d. 9.86%
e. 10.38%

58. Charter Bank pays a 4.50% nominal rate on deposits, with monthly
compounding. What effective annual rate
(EFF%) does the bank pay?

a. 3.72%
b. 4.13%
c. 4.59%
d. 5.05%
e. 5.56%

59. Suppose your credit card issuer states that it charges a
15.00% nominal annual rate, but you must make monthly payments, which amounts
to monthly compounding. What is the effective annual rate?

a. 15.27%
b. 16.08%
c. 16.88%
d. 17.72%
e. 18.61%

60. Pace Co. borrowed $20,000 at a rate of
7.25%, simple interest, with interest paid at the end of each
month. The bank uses a 360-day
year. How much interest would Pace have
to pay in a 30-day month?

a. $120.83
b. $126.88
c. $133.22
d. $139.88
e. $146.87