1. Find i (the rate per period) and n (the number of periods) for the following annuity

Quarterly deposits of $1,200 are made for 3 years into a annuity that pays 5.5% compound quarterly.

2. Use the future value formula to find the indicated value.

n=32; i=0.04;PMT=$58;FV=?

3. Use the future value formula to find the indicated value.

4. Recently, More money 4U offered an annuity that pays 6.0% compound monthly. If $1995 is deposited into this annuity every month, how much is in the account after 6 years? How much of this is interest?

5. In order to accumulate enough money for a down payment on a house, a couple deposits $783 per month into an account paying 6% compounded monthly. If payments are made at the end of each period, how much money will be in the account in 5 years?

6. Acme Annuities recently offered an annuity that pays 7.8% compounded monthly. What equal monthly deposit should be made into this annuity in order to have $159,000 in 18 years?

7. A company estimates that it will need $104,000 in 6 years to replace a computer. If it establishes a sinking fund by making fixed monthly payments into an account paying 5.9% compounded monthly, how much should each payment be?

8. Bob makes his first $1900 deposit into an IRA earning 6.9% compounded annually on his 24th birthday and his last $1900 deposit on his 39th birthday (16 equal deposits in all). With no additional deposits, the money in the IRA continues to earn 6.9% interest compounded annually until Bob retires on his 65th birthday. How much is it in the IRA when Bob retires?

9. Find I (the rate per period) and n (the number of periods) for the following loan at the given annual rate.

Monthly payments of 4272.25 are made for 9 years to repay a loan at 5.75% compounded monthly.

10. Solve the following problem

N=25; i=0.028; PMT =$148; PV=?

11. Solve the following problem

PV=$20,684; n=80; i=0.012; PMT=?;

12. American General offers a 19-year annuity with a guaranteed rate of 6.3% compounded annually. How much should you pay for one of these annuities if you want to receive payments of $600 annually over the 19 year period?

How much should a customer pay for this annuity?

13. E-Loan, an online lending service, recently offered a 36-month auto loans at 3.9% compounded monthly to applicants with good credit ratings. If you can have a good credit rating and can afford monthly payments of $400, how much can you borrow from E-loan? What is the total interest you will pay for this loan?

14. You want to purchase an automobile for $28,695. The dealer offers you 0% financing for 72 months or a $3,312 rebate. You can obtain 5.7% financing for 72 months at the local bank. Which option should you choose?

___0% financing – This is better as monthly outgo is lower.

___Rebate

How much money will you save per month?

15. A sailboat costs $28,681. You pay 25% down and amortize the rest with equal monthly payments over a 9-month period. If you must pay 6.6% compounded monthly, what is your monthly payment? How much interest will you pay?

16. Some friends tell you that they paid $17,389 down on a new house and are to pay $630 per month for 30 years. If interest is 6.3% compounded monthly, what was the selling price of the house? How much interest will they pay in 30 years?

17. A family has a $96,382, 30 year mortgage at 5.7% compounded monthly. Find the monthly payment. Also find the unpaid balance after 5 years and after 10 years.