10-12

10. A payday loan business in town charges $3 interest per two week on a $200 loan. The effective interest rate on this loan is A. 39% B. 47.27% C.52.1% D. None of those 11. Consider the cash flows in the table bolow: Year 0 1 2 3 4 $80 5 $140 Cash Flow $100 $50 $60 $70 Which one of the following is correct for this cash flow (circle)? A. 100 50+ 10(A/G, i, 5) +50(P/F, 4, 5) B. (50(P/A, 4, 5)+10(P/G, 4, 5)+50(P/F, i, 5))/(100)=1 C. 100(P/A, 1, 5)=50+10(A/G, i, 5) D. None of the equations are correct. 12. A series of end-of-the-year cash flows of $2,000 for ten years at an annual interest rate of 8% is nearly equal to a series of end-of-the-year cash flows at 10% interest for eight years. Determine the value of the uniform amount, A (circle) A. $1,678 B. $2,515 C.$1,590 D. None of those