HISTO 26. At an effective interest rate of 12%, a single sum invested today will double itself in approximately a. 6 years. b. 12 years. c. insufficient data to determine answer. d. 8 years. 27. What monthly rate of interest will yield an annual effective rate of interest of 14%? a. 1.17% b. 1.10% c. 1.08% d. 1.14% 28. If Susan and Joe set aside $10,000 for college tuition when their daughter is 13, how much will be available when she starts college at 18 if the account in which the money is deposited pays 12 percent compounded monthly? 2. $17,623.42 b. $18,170 c. $16,105.10 d. $16,122.26 29. John is 25 years old and wishes to retire in 30 years. His plan is to invest in a mutual fund earning a 12 percent annual return and have a $1 million retirement fund at age 55. How much must he invest at the end of each year to achieve this goal? a. $5.024.60 b. $7.499.96 c. $33,333.33 d. $4,143.65 30. When you purchased a car, you borrowed 20,000 from the bank at 9.20% and agreed to make monthly payments for 3 years. What is your monthly payment? a. $153.33 b. $662.08 c. $584.12 d. 5559.78 31. An inverted yield curve: a. exists when short-term interest rates are higher than long-term interest rates b. exists when long-term interest rates are higher than short-term interest rates c. is also known as a normal yield curve d. Both a &e Both b&c . Page 6 of 12