An investment of $100 pays interest of 5% per quarter. What will be the value of this investment at the end of 3 years?

4 points

A. $107.69

B. $133.10

C. $134.49

D. $179.59

An investment offers to pay $120 a year forever starting at the end of year 6. If the interest rate is 6%, what is the investments value today? (hint: draw a clear timeline)

4 points

A. $1,586.87

B. $850.73

C. $1,494.52

D. $1,409.92

A furniture store is offering free credit on purchases over $1,000. You observe that a big-screen television can be purchased for nothing down and $3,800 due in one year. The store next door offers an identical television for $3,650 but does not offer credit terms. Which statement below best describes the cost of the "free" credit?

4 points

A. 3.58%

B. 9.13%

C. 9.59%

D. 4.11%

How much more is a perpetuity of $1,000 worth than an annuity of the same amount for 25 years? Assume an interest rate of 10% and cash flows at the end of each period.

4 points

A. $922.96

B. $1,486.44

C. $2,200.00

D. $1,297.29