1. An investment of $14,000 was growing at 4.25% compounded semi-annually.

a. Calculate the accumulated value of this investment at the end of year 1.

Round to the nearest cent

b. If the interest rate changed to 4.75% compounded monthly at the end of year 1, calculate the accumulated value of this investment at the end of year 4.

Round to the nearest cent

c. Calculate the amount of interest earned from this investment during the 4-year period.

Round to the nearest cent

2. Meadow Company wants to invest its net profits of $100,000 for 7 years in either a credit union or a local bank. The credit union provides interest of 4.50% compounded monthly, while the local bank provides interest of 5.00% compounded semi-annually.

a. What would be the maturity value of the investment under the credit union option?

Round to the nearest cent

b. What would be the maturity value of the investment under the local bank option?

Round to the nearest cent

c. Which of the two options will yield the highest return?

a. Credit Union

b. Local Bank

3. The interest rate on a GIC is 3.50% compounded quarterly. What is the purchase price of the GIC if its maturity value in 3 years and 9 months is $35,607?

4. How much did Speedy Movers borrow for a debt that accumulated to $56,677.14 in five years? The interest rate was 4.75% compounded quarterly.

5. The maturity value of a savings account that belonged to Peach Company was $45,093.50. The interest charged for the first 3 years was 6% compounded semi-annually, and 4% compounded quarterly for the next 5 years.

a. Calculate the amount that was deposited in the savings account at the beginning of the period.

Round to the nearest cent

b. Calculate the total amount of interest earned from this investment.

Round to the nearest cent

6. Blake invested his savings into a Registered Retirement Savings Plan (RRSP) at an interest rate of 3.25% compounded semi-annually. After one year, his investment grew to $24,600; however, the interest rate on the RRSP changed to 3.50% compounded quarterly and remained constant for the next two years.

a. Calculate the original amount he invested into the RRSP.

$

Round to the nearest cent

b. Calculate the accumulated value of the investment at the end of three years (two years after the rate change).

$

Round to the nearest cent

7. A company currently owes $20,000 to a bank for a loan it took 5 years and 9 months ago. The interest rate charged on the loan was 5% compounded monthly.

a. What was the original principal of the loan?

Round to the nearest cent

b. What was the amount of interest charged on the loan?

Round to the nearest cent

8. Elizabeth is expected to settle a loan on June 11th, 2018 by paying $3,000. What amount should he pay if he decides to settle it on July 19th, 2017 instead? The interest rate is 2.67% compounded monthly.

9. Green Inc. invested $20,000.00 in a fund at an interest rate of 2.00% compounded annually. At the end of 22 months their investment advisor transferred these funds to another investment that was yielding 13.50% compounding monthly for the next year. By how much did the fund grow?