#1

Derek decides to buy a new car. The dealership offers him a choice of paying $542.00 per month for 5 years (with the first payment due next month) or paying some amount today. He can borrow money from his bank to buy the car. The bank requires a 6.00% interest rate. What is the most that he would be willing to pay today rather than making the payments?

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Answer format:Currency: Round to: 2 decimal places.

#2

Derek plans to buy a $29,759.00 car. The dealership offers zero percent financing for 60.00 months with the first payment due at signing (today). Derek would be willing to pay for the car in full today if the dealership offers him $____ cash back. He can borrow money from his bank at an interest rate of 5.71%.

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Answer format:Currency: Round to: 2 decimal places.

#3

Derek decides to buy a new car. The dealership offers him a choice of paying $507.00 per month for 5 years (with the first payment due next month) or paying some $28,085.00 today. He can borrow money from his bank to buy the car. What interest rate makes him indifferent between the two options?

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Answer format:Percentage Round to: 3 decimal places (Example: 9.243%, % sign required. Will accept decimal format rounded to 5 decimal places (ex: 0.09243))

#4

Derek wants to withdraw $14,897.00 from his account 7.00 years from today and $12,914.00 from his account 15.00 years from today. He currently has $3,596.00 in the account. How much must he deposit each year for the next 15.0 years? Assume a 5.15% interest rate. His account must equal zero by year 15.0 but may be negative prior to that.

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Answer format:Currency: Round to: 2 decimal places.

#5

Derek currently has $10,464.00 in an account that pays 5.00%. He will withdraw $5,592.00 every other year beginning next year until he has taken 5.00 withdrawals. He will deposit $10464.0 every other year beginning two years from today until he has made 5.0 deposits. How much will be in the account 25.00 years from today?

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Answer format:Currency: Round to: 2 decimal places.

#6

Derek can deposit $298.00 per month for the next 10 years into an account at Bank A. The first deposit will be made next month. Bank A pays 12.00% and compounds interest monthly. Derek can deposit $2,522.00 per year for the next 10 years into an account at Bank B. The first deposit will be made next year. Bank B compounds interest annually. What rate must Bank B pay for Derek to have the same amount in both accounts after 10 years?

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Answer format:Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434))

#7

Suppose you deposit $1,142.00 into and account 4.00 years from today into an account that earns 6.00%. How much will the account be worth 16.00 years from today?

Answer format:Currency: Round to: 2 decimal places.