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QUESTION 6

Four mortgages:
	W	X	Y	Z
Borrow	1,000	1,000	1,000	1,000
Balloon payment	0	200	1,000	1,300

Which of the following is most correct?

	a.	Y is full amortization; X is negative amortization
	b.	W is zero amortization; Y is full amortization
	c.	X is partial amortization; Z is negative amortization
	d.	W is full amortization, X, Y and Z are all partial amortization QUESTION 7 What is the EAR of 13.8% per annum, compounded weekly? Show your answer to two decimal points.

QUESTION 8

What is the NPV for an investment with an initial outlay now of $488, and expected cash inflows of $148, $298 and $358 at the end of years one through three, respectively, at a discount rate of 9.2% ?

QUESTION 9

A business borrows $297,348 for 11 years at an annual rate of interest of 7.7%. If payments are annual and the loan will negatively amortize by $39,963, what will be the annual payment required? Put your answer in as a positive number.

QUESTION 10

What is the present value of a perpetuity making quarterly payments in arrears in the amount of $9,475 per quarter, and the appropriate annual rate of interest is 10.5%?

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