1. You are considering purchasing a new home. You will need to borrow $290,000 to purchase the home. A mortgage company offers you a 20-year fixed rate mortgage

(240 months) at 12% APR (1% month). If you borrow the money from this mortgage company, your monthly mortgage payment will be closest to:

A.

$4,470

B.

$2,554

C.

$3,193

D.

5109

2. A home buyer buys a house for $1,234,000. She pays 20% cash, and takes a fixed-rate mortgage for ten years at 6.2% APR. If she makes semi-monthly payments, which of the following is closest to each of her payment?

A.

$6,629.44

B.

$6,076.99

C.

$5,524.54

D.

$4,419.63

3.

Use the information for the question below.

Alaska North Slope Crude Oil (ANS)	$71.75/Bbl
West Texas Intermediate Crude Oil (WTI)	$73.06/Bbl

As an oil refiner, you are able to produce

$76

worth of unleaded gasoline from one barrel of Alaska North Slope (ANS) crude oil. Because of its lower sulfur content, you can produce

$77

worth of unleaded gasoline from one barrel of West Texas Intermediate (WTI) crude.Another oil refiner is offering to trade you

10,200 Bbls

of Alaska North Slope (ANS) crude oil for

10,050 Bbls

of West Texas Intermediate (WTI) crude oil. Assuming you currently have

10,050 Bbls

of WTI crude, the added benefit (cost) to you if you take the trade is closest to:

A.

($1,350)

B.

$1,350

C.

($3,250)

D.

$3,250