8. You want to buy another vehicle and know you can afford $265.00 a month for 4 years. The interest rate is 8.50 percent, compounded monthly. How much money can you afford to borrow?

A.$7,355.28

B. $10,751.25

C. $12,720.00

D. $15,009.54

11. XYZ firm has a debt-equity ratio of 1.60. What is the equity multiplier if total debt is $65,000?

A. .60

B. .80

C. 2.60

D. 3.20

12. Any situation where a potential conflict can arise between the firms owners and its managers is referred to as a(n):

	a.	agency problem.
	b.	control issue.
	c.	personnel conflict.
	d.	organizational problem.

14. Your parents would like to establish a trust fund that would pay annual payments to you and your heirs of $100,000 a year forever. How much do your parents need to deposit into this trust fund today to achieve their goal if the fund can earn 8.0 percent interest?

		$8,000.00
		$800,000
		$1,000,000
		$1,250,000

15. Today, you deposit $10,750 in a bank account that pays 3 percent simple interest. How much interest will you earn over the next 8 years?

$1,935.00

$2,580.00

$12,257.50

$13,330.00

17. Which one of the following best describes the liability a limited partner has for the Partnership debt?

None

liability limited to amount invested in the firm.

unlimited.

liability limited based on percentage ownership.

18. Your savings account is currently worth $19,200. The account pays 4.5 percent interest compounded monthly. How much will your account be worth 6 years from now?

$25,138.62

$25,003.39

$24,384.00

$24,672.00

20. You want to invest an amount of money today and receive back twice that amount in the future. You expect to earn 15 percent interest. Approximately how long must you wait for your investment to double in value?

		.21 years
		10.5 years
		4.8 years
		20.8 years