Shorty Jones wants to buy a one-way bus ticket to Mule-Snort, Pennsylvania. The ticket costs $142, but Mr. Jones has only $80. If Shorty puts the money in an account that pays 9% interest compounded monthly, how many months must Shorty wait until he has $142 (round to the nearest month)?
A) 73 months
B) 75 months
C) 77 months
D) 79 months
If you put $600 in a savings account that yields an 8% rate of interest compounded weekly, what will the investment be worth in 37 weeks (round to the nearest dollar)?
A) $648
B) $635
C) $634
D) $645
Which of the following formulas represents the future value of $500 invested at 8% compounded quarterly for five years?
A) 500(1 + .08)5
B) 500(1 + .08)20
C) 500(1 + .02)5
D) 500(1 + .02)20
What is the value of $750 invested at 7.5% compounded quarterly for 4.5 years (round to the nearest $1)?
A) $1,048
B) $1,010
C) $1,038
D) $808
If you want to have $10,000 in 10 years, which of the following formulas represents how much money you must put in a savings account today? Assume that the savings account pays 6% and it is compounded monthly.
A) 10,000/(1 + .05)10
B) 10,000/(1 + .005)120
C) 10,000/(1 + .06)10
D) 10,000/(1 + .006)120
Dawn Swift discovered that 20 years ago, the average tuition for one year at an Ivy League school was $4,500. Today, the average cost is $29,000. What is the growth rate in tuition cost over this 20-year period? Round off to the nearest 0.1%.
A) 15.5%
B) 4.2%
C) 9.8%
D) 10.6%
