b. Ordinary Interest, or banker's interest, calculations require the use of 360 days c. None of the above 20. A promissory note a. Does not bear interest b. Is a legal document in which one person or firm agrees to pay a certain amount of money, on a specific day in the future, to another person or firm. c. Is not a legal document 21. The formula of the interest amount of a promissory note is a. Interest = Face Value x Rate Interest = Face Value x Rate x Time c. Interest = Face Value x (Rate / Time) 22. Which of the following definitions is incorrect? a. Maker or payer: The person borrowing the money. b. Face value or principal: The amount paid at maturity c. Payee: The person who loaned the money and who will receive the payment 23. The maturity value is calculated using the following formula a. Maturity Value = Face Value - Interest b. Maturity Value = Face Value + Interest Maturity Value = Face Value x Interest 24. Notes can be a. bought only sold only bought and sold 25. Discounting the note proceeds can be - finding the value of the note on a specific date before it matures. a. Proceeds (loan amount) = Face value - Bank discount b. Proceeds (loan amount) = Face value + Bank discount c. None of the above BONUS QUESTIONS (1 POINT EACH) 6. The community college will match Roman Rodriguez's contribution into his retirement plan, but only up to 5% of his salary. In other words, the college will put $1 into his retirement plan for every $1 that Rodriguez puts into it, but they will not contribute more than 5% of his $32,000 yearly salary. Rodriguez decides to put 5% of his salary into the retirement plan. Determine the an Annuity Factor using the table below if the account earns 8% compounded quarterly for a time period of 5 years.Amount of an Annuity Table PERIOD INTEREST RATE PER PERIOD PERIOD n 1% 1% 2% 22% 3% 4% 5% 6% 8% 10% 12% 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 2 2.01000 2.01500 2.02000 2.02500 2.03000 2.04000 2.05000 2.06000 2.08000 2.10000 2.12000 3.03010 3.04522 3.06040 3.07562 3.09090 3.12160 3.15250 3.18360 3.24640 3.31000 3.37440 4.06040 4.09090 4.12161 4.15252 4.18363 4.24646 4.31013 4.37462 4.50611 4.64100 4.77933 5 5.10101 5.15227 5.20404 5.25633 5.30914 5.41632 5.52563 5.63709 5.86660 6.10510 6.35285 6 6.15202 6.22955 6.30812 6.38774 6.46841 6.63298 6.80191 6.97532 7.33593 7.71561 8.11519 7 7.21354 7.32299 7.43428 7.54743 7.66246 7.89829 8.14201 8.39384 8.92280 9.48717 10.08901 8 8.28567 8.43284 8.58297 8.73612 8.89234 9.21423 9.54911 9.89747 10.63663 11.43589 12.29969 9 9.36853 9.55933 9.75463 9.95452 10.15911 10.58280 11.02656 11.49132 12.48756 13.57948 14.77566 10.46221 10.70272 10.94972 11.20338 11.46388 12.00611 12.57789 13.18079 14.48656 15.93742 17.54874 10 11.56683 11.86326 12.16872 12.48347 12.80780 13.48635 14.20679 14.97164 16.64549 18.53117 20.65458 11 360 VanAWN. 12 12.68250 13.04121 13.41209 13.79555 14.19203 15.02581 15.91713 16.86994 18.97713 21.38428 24.13313 12 3 13.80933 14.23683 14.68033 15.14044 15.61779 16.62684 17.71298 18.88214 21.49530 24.52271 28.02911 13 14 14.94742 15.45038 15.97394 16.51895 17.08632 18.29191 19.59863 21.01507 24.21492 27.97498 32.39260 14 15 16.09690 16.68214 17.29342 17.93193 18.59891 20.02359 21.57856 23.27597 27.15211 31.77248 37.27971 15 16 17.25786 17.93237 18.63929 19.38022 20.15688 21.82453 23.65749 25.67253 30.32428 35.94973 42.75328 16 17 18.43044 19.20136 20.01207 20.86473 21.76159 23.69751 25.84037 28.21288 33.75023 40.54470 48.88367 17 18 19.61475 20.48938 21.41231 22.38635 23.41444 25.64541 28.13238 30.90565 37.45024 45.59917 55.74971 18 19 20.81090 21.79672 22.84056 23.94601 25.11687 27.67123 30.53900 33.75999 41.44626 51.15909 63.43968 19 20 22.01900 23.12367 24.29737 25.54466 26.87037 29.77808 33.06595 36.78559 45.76196 57.27500 72.05244 20 21 23.23919 24.47052 25.78332 27.18327 28.67649 31.96920 35.71925 39.99273 50.42292 64.00250 81.69874 21 22 24.47159 25.83758 2' 286 30.53678 34.24797 38.50521 43.39229 55.45676 71.40275 92.50258 22 23 25.71630 27.22514 28.84496 30.58443 32.45288 36.61789 41.43048 46.99583 60.89330 79.54302 104.60289 23 24 26.97346 28.63352 30.42186 32.34904 34.42647 39.08260 44.50200 50.81558 66.76476 88.49733 118.15524 24 25 28.24320 30.06302 32.03030 34.15776 36.45926 41.64591 47.72710 54.86451 73.10594 98.34706 133.33387 25 The annuity factor from the table is . 5.20404 b. 45.76196 C. 24.29737 27. An Annuity is defined as a. Payments made at the end of each year Payments made at maturity Series of equal payments made at regular intervals 28. Present Value of Annuity is define as a. Annuity that accumulates funds b..Annuity that uses up funds that have already been accumulated to make a series of payments c. All of the above
