Which is not one of the ways of finding the periodic interest rate for annuities?

		Solve the annuity formulas for i.
		Technology.
		Trial and error.

1. Consider the situation:

   You would like to save $1000 to purchase a laptop. Your bank account earns 1.2% compounded monthly and you plan on depositing $50 every month. How long will it take to reach your goal?

   Which variable will you need to calculate/solve f

   2. Excel functions that can help with annuity calculations include FV, PV, RATE, and NPER.

   		FV
   		n
   		i
   		PMT

3. Payments of $200 monthly are made with 3% compounded quarterly to save to $1000. In this situation, i = 0.0075. 

 True

1.  False

   
   

   1. With questions that you need to solve for n, you still need to take into account the compounding and payment frequencies.

      4. With questions that you need to solve for n, you still need to take into account the compounding and payment frequencies. 

       False

   2.  True

      
      

      5. Excel functions that can help with annuity calculations include FV, PV, RATE, and NPER.

      
      

      1.  True

      2.  False

      3. 6. A scenario is asking for the effective interest rate. Using technology to find i, you find it to be 0.0125. Therefore, the effective interest rate = 0.0125.

      4.  True

         1.  False

         2. 
            

         3. 
            

         
         

   3.