19. A credit card has an annual percentage rate of 12.9 percent and charges interest monthly. The effective annuai rate account A. will be greater than 12.9 percent. C. is 12.9 percent. D. can either be greater than or equal to 12.9 percent o 12.9 percent. will be less than 12.9 percent. 20. Suenette plans to save $600 at the end of Year 1. $800 at the end of Year 2, and $1,000 at the end of Year 3. tIf she earns 3.4 percent on her savings, how much money will she have saved at the end of Year 3? A. $2,200.00 B. $2,238.47 C. $2,309.16 D. $2,468.69 E. $2,402.19 21. Capstone Investments is considering a project that will produce cash infiows of $11,000 at the end of Year 1, $24,000 in Year 2, and $36,000 in Year 3. What is the present value of these cash inflows at a discount rate of 12 percent? A $41,997.60 B. $46,564.28 C. $54,578.17 D. $54,868.15 E. $63,494.54 22. Chandler Tire Co. is trying to decide which one of two projects it should accept. Both projects have the same start-up costs. Project 1 will produce annual cash flows of $52,000 a year for six years. Project 2 will produce cash flows of $48,000 a year for eight years. The company requires a 15 percent rate of return. Which project should the company select and why? A Project 1, because the present value of its cash inflows exceeds those of Project 2 by $14,211.62 B. Project 1, because the annual cash flows are greater by $4,000 than those of Project 2 C. Project 2, because the total cash inflows are $72,000 greater than those of Project 1 D. Project 2, because the present value of the cash inflows exceeds those of Project 1 by $18,598.3*3 E It does not matter as both projects have almost identical present values 23. You want to purcha balance over 15 years at 3.75 percent. What will be your monthly mortgage payment including principal and interest? se a new condominium that costs $287,500. Your plan is to pay 25 percent down in cash and finance the A. $1,221.43 B. $1,333.33 C. $1,708.16 D. $1,568.07 E. $1,406.11 24. What condition must exist if a bond's coupon rate is to equal both the bond's current yield and its yield to maturity? Assume the market rate of interest for this bond is positive. A The clean price of the bond must equal the bond's dirty price. B. The bond must be a zero coupon bond and mature in exactly one year C. The market price must exceed the par value by the value of one year's interest. D. There is no condition under which this can occur. E. The bond must be priced at par