Question
1. You would like to invest an amount in a savings account paying 4% compounded daily. Your goal is to have $10,000 in 10 years.
1. You would like to invest an amount in a savings account paying 4% compounded daily. Your goal is to have $10,000 in 10 years. How much should you invest?
A. $345.72
B. $5000
C. $6703.35
D. $6755.64
2. In the following question, make the assumption that the change in housing prices exactly matches the change in the CPI. In fact, housing is only part of the CPI and figures into the CPI through rents rather than sale prices, so this assumption may be far from correct.
Zeke bought a house in 1981 for $19,000 and sold it in 1997. If the 1981 CPI is 90.9 and the 1997 CPI is 160.5, how much would the house be worth in 1997 dollars?
A. $26,300
B. $27,860
C. $29,808
D. $33,548
3. The CEO of a start-up company wants to offer employees a stock program with a real growth rate of 6%. If the current inflation rate is 3%, what should the annual yield for the stock program be?
A. 9.18%
B. 9.00%
C. 6.18%
D. 6.30%
4. If you save $350 per month in an account paying 2.75% interest compounded monthly, how much will you have in that account 12 years later?
A. $57,842.75
B. $58,952.45
C. $59,631.31
D. $60,412.54
5. If the rate of a 24-month CD is 1.15% compounded daily, how much would need to be set aside in such a CD to have $25,000 at the end of 24-month term?
A. $24,279.41
B. $24,431.57
C. $24,681.23
D. $24,750.34
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