31.

While on Spring Break, you have decided you have had enough of the beach, so you enter the prestigious Cancun Bond Valuation World Championship, which, being a Michigan State student, you win easily. Your grand prize is $500. However, you go a little overboard in celebrating, and you have to put $1500 on your credit card to pay for the festivities (your previous balance was 0). You still have the money that you won, which you decide to pay toward your credit card balance as soon as you get home. The annual interest rate on your credit card is 18% compounding monthly (i.e. monthly interest is 18%/12). If you make monthly payments of $25, how long will it take to pay the credit card balance to zero?

Question 31 options:

	5.13 years
	12.89 years
	61.54 years
	1.99 years

32.

Your part-time job as Barista at the local coffee house has convinced you that you are ready to buy a $45,000 BMW. Unfortunately you have no money for a down payment. The local bank, Loansforall Savings and Trust, is willing to give you a 4-year loan for the $45,000 you need at 12% annual interest compounding monthly. What will your monthly payments be?

Question 32 options:

	$985
	$845
	$635
	$1,185
	$1,565