Math 1101 chapter 10 review

 

 

  1. Chris just paid off his car.  He calculates that it will last 5 more years.  He would like to save enough money during this time to buy a new car and pay it off entirely.  He is expecting to pay $24,000 for the car.  How much should he put away each month if his interest rate is 7.2% compounded monthly?

 

  1. The cost of tuition at NEI for one year is approximately $12,800.  If an annual increase of 8% is expected, what will be the cost of tuition for one year in 15 years?

 

  1. Jennifer wants to retire in 40 years.  She puts $300/month into a retirement fund which earns a 9% nominal interest rate.  How much money will she have when she retires?

 

  1. Chad has $1,000,000 in his retirement account when he retires.  How much money can he withdraw each month if he plans to live for 20 years and his investment earns 6% compounded monthly?

 

 

1.                  Given an investment of $7000 compounded at 8% quarterly, what will its value be after 26 years?

 

2.                  What is the effective interest rate of 12% compounded monthly?  Ans 12.68%

 

3.                  If you put $50 per month into an annuity which earns 15% per your compounded monthly, how much will you have in 25 years?  Ans: $162,176.48

 

4.                  You buy a Jeep Grand Cherokee for $28,000 and put 10% down.  The financing is secured at 8% compounded monthly.  What are the monthly payments if you finance the Jeep for 36 months?  48 months?  60 months?  What is the total amount paid on each of the above loans?

 

5.                  Fred needs to pay back Vinnie the loan shark $50,000 for a gambling debt.   If an interest rate of 21% per year is charged on the unpaid balance, create an amortization chart so that Fred pays the loan back in 5 years with payments at the end of each year.

 

6.                  Thomas wants to have $1,000,000 when he retires in 35 years.  How much does he need to deposit each month in a retirement account which earns 8.5% per year compounded monthly?  What is the value of that amount in today’s money if there was an annual inflation rate of 4 %?

 

 

  1. Given the following sequence: -5, -9, -13, -17, ...          (3 points each)

A.                 Is the sequence arithmetic or geometric?                                    ____________

                                                                                               

 

B.                 What is the formula for the nth term of the sequence?     ____________

                                                                                   

 

 

 

 

 

C.                 What is the 25th term of the sequence?                          ____________

 

 

 

  1. Given the sequence find the sum of the first 15 elements.

 

 

 

 

7.      Given the recursively defined sequence:

            find the first four terms of the sequence.

 

 

 

 

 

 

 

 

8.         Given the following sequence: 5, 2.5, 1.25, .625, ...       (3 points each)

A.                 Is the sequence arithmetic or geometric?                                    ____________

 

 

 

 

B.                 What is the formula for the nth term of the sequence?     ____________

 

 

 

 

 

C.                 What is the 12th term of the sequence?                          ____________

 

 

 

 

 

 

D.                 Find the sum of the first 12 terms of the sequence.                     ____________

 

 

 

 

 

           

9.      Find the infinite sum of the sequence: 8, 8/3, 8/9, 8/27, ...