6.

How much can you borrow if you are willing to make payments of $800 per month (at 6% annual rate) for 30 years?

	$150,000.00
	$133,433.00
	No solution. Cannot compute this.
	$198,566.00

7.

Your goal is to have $1,500,000. You have a total of $40,000 today. You invest the $40,000 and want to add to it each month. At 11% annual interest, how much do you need to invest each month in order to bring the total up to $1,500,000 30 years from now?

	$534.00
	$612.00
	$266.00
	$153.00

8.

(Assuming all other factors remain constant) When calculating PV, if you use a LOWER discount (interest) rate:

	there will be no effect on the PV.
	cannot tell what would happen in this case without more information.
	the PV will be lower.
	the PV will be higher.

9.

(Assuming all other factors remain constant) When calculating a PV, if the discount (interest) rate is HIGHER, what will the effect be?

	The PV will be lower
	Cannot tell what would happen without more information
	The PV will remain the same
	The PV will be higher

10.

You wish to buy a cabin in 20 years. TODAY, the cabin costs $100,000. You believe the price of the cabin will inflate at 5% annually. You want to invest a single amount of money (lump sum) today and have the money grow to equal the future purchase price of the cabin 20 years from now. If you can earn 11% annually on your investments, how much do you need to invest NOW, in order to be able to purchase the cabin?

	$32,909.00
	$88,980.00
	$43,221.00
	$100,000.00

Choose the correct answers