1. (1 point) A loan is repaid with payments which start at $200 the first year and increase by $40 per year until a payment of $760 is made, at which time payments cease. If interest is 8% effective, find the amount of principal in the 5th payment. 6. (1 point) A loan is amortized over 5 years with monthly payments at a nominal interest rate of 7% compounded monthly. The first payment is $900 and is to be paid one month from the date of the loan. Each succeeding monthly payment will be 1% lower than the prior payment. Calculate the outstanding loan balance immediately after the 37th payment is made | ANSWER-$ ANSWER $ 2. (1 point) A borrower is repaying a $3000 loan with 10 equal payments of principal. Interest at 6% convertible semi annually is paid on the outstanding balance together with the coupon bond that matures for $3300 in 10 years to yield: semiannual payments of the principal. Find the current price of the payments to yield an investor 12% convertible semiannually. a) 10% effective 7. (1 point) Find the price which should be paid for a zero ANSWER = $ ANSWER-S b) 9% effective. ANSWER $ c) Thus, a 10% reduction in the yield rate causes the price to 3. (1 point) A borrows $2100 at an effective rate of inter, of 10% per annum and agrees to repay the loan with payments increase by what percentage? at the end of each year. The first payment is to be $300 and each payment thereafter is to be 4% greater than the preceding payment, with a smaller final payment made one year after the last regular payment ANSWER $ 8. (1 point) A 20-year accumulation bond with an initial par value of $1000 earns interest of 7.5% compounded bimonthly Find the price to yield an investor 9% effective. a) Find the outstanding loan balance at the end of 2nd years ANSWER -S b) Find the principal repaid in the third payment. ANSWER-S ANSWER $ 9. ( point) A 26-week T-bl is bought for $9400 at issue and will mature for $10,000. Find the yield rate computed as: 4. (1 point) A has money invested at effective rate i. At the end of the first year A withdraws 142% of the interest earned, a) A discount rate, using the typical method for counting days at the end of the second year A withdraws 284% of the interest on a T-bill. (Note: For T-bill, the discount rate is the simple earned, and so forth with the withdrawal factor incre asing idiscount rate and there are 360 days a year.) arithmetic progression. At the end of 15 years the fund iANSWER- actly exhausted. Find i. b) An annual effective rate of interest, assuming the investment period is exactly half a year. ANSWER - 1. (1 point) A loan is repaid with payments which start at $200 the first year and increase by $40 per year until a payment of $760 is made, at which time payments cease. If interest is 8% effective, find the amount of principal in the 5th payment. 6. (1 point) A loan is amortized over 5 years with monthly payments at a nominal interest rate of 7% compounded monthly. The first payment is $900 and is to be paid one month from the date of the loan. Each succeeding monthly payment will be 1% lower than the prior payment. Calculate the outstanding loan balance immediately after the 37th payment is made | ANSWER-$ ANSWER $ 2. (1 point) A borrower is repaying a $3000 loan with 10 equal payments of principal. Interest at 6% convertible semi annually is paid on the outstanding balance together with the coupon bond that matures for $3300 in 10 years to yield: semiannual payments of the principal. Find the current price of the payments to yield an investor 12% convertible semiannually. a) 10% effective 7. (1 point) Find the price which should be paid for a zero ANSWER = $ ANSWER-S b) 9% effective. ANSWER $ c) Thus, a 10% reduction in the yield rate causes the price to 3. (1 point) A borrows $2100 at an effective rate of inter, of 10% per annum and agrees to repay the loan with payments increase by what percentage? at the end of each year. The first payment is to be $300 and each payment thereafter is to be 4% greater than the preceding payment, with a smaller final payment made one year after the last regular payment ANSWER $ 8. (1 point) A 20-year accumulation bond with an initial par value of $1000 earns interest of 7.5% compounded bimonthly Find the price to yield an investor 9% effective. a) Find the outstanding loan balance at the end of 2nd years ANSWER -S b) Find the principal repaid in the third payment. ANSWER-S ANSWER $ 9. ( point) A 26-week T-bl is bought for $9400 at issue and will mature for $10,000. Find the yield rate computed as: 4. (1 point) A has money invested at effective rate i. At the end of the first year A withdraws 142% of the interest earned, a) A discount rate, using the typical method for counting days at the end of the second year A withdraws 284% of the interest on a T-bill. (Note: For T-bill, the discount rate is the simple earned, and so forth with the withdrawal factor incre asing idiscount rate and there are 360 days a year.) arithmetic progression. At the end of 15 years the fund iANSWER- actly exhausted. Find i. b) An annual effective rate of interest, assuming the investment period is exactly half a year