Question 7 O out of 5 points A $150,000 home is financed with a 30-year mortgage with monthly payments at the end of each month. The loan has a nominal annual X yield rate of 12% compounded monthly. In addition to the required monthly payment, the buyer pays an additional amount Y each month. This results in shortening the length of the loan from 30 years to 25 years. Find Y. Hint: Find the payment amount, X, under the original terms. Find the payment, Z, using a loan length of 25 years, then Y = Z-X. Question 8 O out of 5 points A retirement account, X, has a balance of $500,000 at time t=0. The account earns an annual effective rate of interest of i =5%. At the X end of each year for 10 years, the interest earned an additional $50,000 are withdrawn and placed into a "safer" investment account, Y, that pays an annual effective rate of 3%. Determine the accumulated value in account y at the end of the 10th year. Note; account A will have a zero balance at the end of the 10th year as all funds will have been transferred to B. Hint: This will involve a level annuity and a decreasing annuity. You may also be able to view it as a (P.2) annuity. Question 9 O out of 5 points A loan is to be repaid with 10 annual payments of size $647.52 made at at the end of each year. The loan has an annual effective rate Xofi. The amount of principal in the 6th payment is $507.35. Determine i. Hint: As the payments are level, there is a formula for the amount of principal in the 6th payment that will allow you to algebraically solve for i. Question 10 O out of 5 points A loan of $10,000 is to be repaid with 20 equal annual payments. The interest rate on the loan is an annual effective rate of 6%. Find the x balance on the loan after the 10th payment. Question 11 O out of 5 points A 10-year bond with semi-annual coupons has a face (par) value of $500 and a redemption value of $515. The coupon rate is a nominal X annual rate of (2) = 7% compounded semi-annually and the yield rate is a nominal annual rate of 7(2) = 6% compounded semi-annually. Find the amount of premium written down in the 9th coupon payment. Question 12 O out of 5 points Bea wants to accumulate $75,000 in a fund at the end of 15 years (t = She plans to deposit $1200 + tx at the end of each year for X each of the first 10 years (t=1,2,3,...,10) and $1000 at the end of each of the last five years (t=11,12, ...,15). Bea's fund will earn an interest at an annual effective rate of 7%. Hint: Draw a diagram. This will involve both level annuities and an increasing annuity. Question 13 O out of 5 points A severance package for an employee is designed as follows: The terminated employee will receive monthly payments at the end of X each month for a period of one year (12 payments). The first payment is $7,000 and each successive payment is reduced by 5% (i.e. the second payment amount is 95% of th first payment amount, the third payment amount is 95% of the second payment amount, etc). As soon as the employee receives each payment, they deposit them into an account earning a nominal annual effective rate of interest of 8.4%. Determine the accumulated value in the account at the end of the year (following receipt and deposit of the 12th payment). Hint: "inflation" is a negative 5%. Question 7 O out of 5 points A $150,000 home is financed with a 30-year mortgage with monthly payments at the end of each month. The loan has a nominal annual X yield rate of 12% compounded monthly. In addition to the required monthly payment, the buyer pays an additional amount Y each month. This results in shortening the length of the loan from 30 years to 25 years. Find Y. Hint: Find the payment amount, X, under the original terms. Find the payment, Z, using a loan length of 25 years, then Y = Z-X. Question 8 O out of 5 points A retirement account, X, has a balance of $500,000 at time t=0. The account earns an annual effective rate of interest of i =5%. At the X end of each year for 10 years, the interest earned an additional $50,000 are withdrawn and placed into a "safer" investment account, Y, that pays an annual effective rate of 3%. Determine the accumulated value in account y at the end of the 10th year. Note; account A will have a zero balance at the end of the 10th year as all funds will have been transferred to B. Hint: This will involve a level annuity and a decreasing annuity. You may also be able to view it as a (P.2) annuity. Question 9 O out of 5 points A loan is to be repaid with 10 annual payments of size $647.52 made at at the end of each year. The loan has an annual effective rate Xofi. The amount of principal in the 6th payment is $507.35. Determine i. Hint: As the payments are level, there is a formula for the amount of principal in the 6th payment that will allow you to algebraically solve for i. Question 10 O out of 5 points A loan of $10,000 is to be repaid with 20 equal annual payments. The interest rate on the loan is an annual effective rate of 6%. Find the x balance on the loan after the 10th payment. Question 11 O out of 5 points A 10-year bond with semi-annual coupons has a face (par) value of $500 and a redemption value of $515. The coupon rate is a nominal X annual rate of (2) = 7% compounded semi-annually and the yield rate is a nominal annual rate of 7(2) = 6% compounded semi-annually. Find the amount of premium written down in the 9th coupon payment. Question 12 O out of 5 points Bea wants to accumulate $75,000 in a fund at the end of 15 years (t = She plans to deposit $1200 + tx at the end of each year for X each of the first 10 years (t=1,2,3,...,10) and $1000 at the end of each of the last five years (t=11,12, ...,15). Bea's fund will earn an interest at an annual effective rate of 7%. Hint: Draw a diagram. This will involve both level annuities and an increasing annuity. Question 13 O out of 5 points A severance package for an employee is designed as follows: The terminated employee will receive monthly payments at the end of X each month for a period of one year (12 payments). The first payment is $7,000 and each successive payment is reduced by 5% (i.e. the second payment amount is 95% of th first payment amount, the third payment amount is 95% of the second payment amount, etc). As soon as the employee receives each payment, they deposit them into an account earning a nominal annual effective rate of interest of 8.4%. Determine the accumulated value in the account at the end of the year (following receipt and deposit of the 12th payment). Hint: "inflation" is a negative 5%