- 1. It is not uncommon for an equipment salesperson to call on a prospective customer, describe and explain a piece of equipment, state its price, offer it for sale, and have the offer rejected
A) First cost
B) Operation cost
C) Mutual benefit in exchange
D) Persuasion in exchange
- 2. If interest is paid at a rate of 5% per year, compounded quarterly, what is the effective rate?
A) 6.094%
B) 5.093%
C) 6.093%
D) 5.094%
- 3. Jeffrey buys an electric fan from a merchant who ask 1,250 pesos at the end of 60 days. Jeffrey wishes to pay immediately and the merchant offers to compute the cash price on the assumption that money is worth 8 percent (%) simple interest. What is the cash price today?
A) 1,232.55 pesos
B) 1,234.5 pesos
C) 1,133.55 pesos
D) None of these
- 4. It is the equivalent interest rate per year of any compound interest rate expressed in other periods.
A) Interest rate
B) Effective rate of interest
C) Compound interest
D) Nominal rate of interest
- 5. What if the compounding modes of every 1.5 months?
A) 4
B) 12
C) 6
D) 8
- 6. Consist of defining alternative that originated in the creative step, or that have been selected for comparison in some other way.
A) None of these
B) The conversion step
C) The decision step
D) The creative step
- 7. If $500 is invested now,$ 700 two years form now, and $900 four year form now, all at 4% what be the total amount in 10 years?
A) $2837.907
B) $2838.907
C) $2835.906
D) $2836.907
- 8. What is the formula of the present worth of deferred annuity?
A) None of these
B) A[1-(1+i)^-n/i] (1+i)m
C) A[1-(1+i)^-n/i] (1+i) ^-m
D) A[1-(1+i)^-n/i]
- 9. What is the formula of future worth for continuous compounding?
A) Pern
B) Penm
C) Pe^-mn
D) Pe^-rn
- 10. A man deposit $300 at the end of each 6 months in a bank paying 2% compounded semi- annually. How much will he have to his credit at the end of 10 years if he makes no withdrawals?
A) $7,600
B) $6,605
C) $7,605
D) $6,600
- 11. What annuity over a 10 year period at 8% interest is equivalent to a present worth of $100?
A) $14.90
B) $15.912
C) $14.912
D) $15.91
- 12. what is the formula of the future worth of ordinary annuity?
A) A[1+i)-1/i]
B) A/i
C) A[1-(1+i)^-n/i]
D) None of these
- 13. it is a series of equal payments made at equal intervals of time.
A) Annuity
B) Ordinary annuity
C) None of these
D) Anniuty
- 14. . A state engineer estimates that the cost or a canal is $680 million. The legislative analyst estimates the equivalent annual cost of the investment for the canal to be $20.4 million. If the analyst expects the canal to last indefinitely, what interest rate is he using to compute equivalent annual cost?
A) 4%
B) 5%
C) 3.9%
D) 3%
- 15. What is the accumulated amount of the five-year annuity paying 6,000 pesos at the end of each year with interest at 15% compounded annually?
A) 40,544.29
B) 40.454.29
C) 41,114.29
D) 41,454.29
- 16. What is the compounding modes of every half month.
A) 8
B) 24
C) 17
D) 6
- 17. it is an annuity in which the periodic payments continue indefinitely
A) Annuity due
B) Deferred annuity
C) Ordinary annuity
D) Perpetuity
- 18. Approximately how many years will it take to double an investment at 5.87% interest rate compounded quarterly?
A) 11 years
B) 10 years
C) 9 years
D) 12 years
- 19. A man buys a house and lot for $100,000 down- payment and 10 deferred semi-annual payments of $8,000 each, starting 3 years from now. What is the cash price of the house and lot if the rate of interest is 12% compounded semi-annually?
A) $147,00
B) $145,700
C) $144,000
D) $146,00
- 20. What is the formula of effective rate of interest?
A) (1+r/m) m-1
B) (1+m/r)m-1
C) None of these
D) e-1
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