Short Answer (worth 2 points each)
1.
Your charge account statement shows an unpaid balance of $4,285.24. The monthly
finance charge is 2.09 percent of the unpaid balance. What is the finance charge?
2.
Don Smith had a previous balance at the local Hardware store of $239.85. He had
payments and credits of $59.22. The finance charge is 1.25 percent of the unpaid balance.
He also had $100.98 in new purchases. What is the new balance?
3.
Use the following chart to find the average daily balance (new purchases included).
Dates
1/1–1/9
1/10
1/11–1/19
1/20
1/21–1/31
Payment Purchase
$28.78
$250.00
End-ofDay
Balance
$475.82
x Number of
Days
x
x
x
x
x
Total
Sum of
Balances
9
1
9
1
11
31
4.
Your charge account statement showed a previous balance of $8,987.53, a finance charge
of $86.92, new purchases of $99.99, and a payment of $1,525.00. What is your new
balance?
5.
Your bank granted you a single-payment loan of $11,850.00. You agreed to repay the
loan in 150 days at an exact interest rate of 5.15 percent. What is the maturity value of the
loan?
6.
You purchased a microwave and dishwasher for $1,253.00. You made a 20 percent down
payment and financed the remainder. What amount did you finance?
7.
You purchased a plasma TV with an installment loan that has an APR of 17 percent. The
TV sells for $4,523.00. The store financing required a 5 percent down payment and 36
monthly payments. What was the finance charge? Use the chart below to answer this
question.
MONTHLY PAYMENT ON A $100.00 LOAN
Term in
Months
6
12
18
24
30
36
42
48
54
Annual Percentage Rate
15.00% 16.00% 17.00% 18.00%
$17.40
$17.45
$17.50
$17.55
$9.03
$9.07
$9.12
$9.17
$6.24
$6.29
$6.33
$6.38
$4.85
$4.90
$4.94
$4.99
$4.02
$4.07
$4.11
$4.16
$3.47
$3.52
$3.57
$3.62
$3.07
$3.12
$3.18
$3.23
$2.78
$2.83
$2.89
$2.94
$2.56
$2.61
$2.66
$2.72
8.
You obtained a simple interest loan at 9 percent interest for 18 months. Your previous
balance was $1,436.00. What is the final payment if the loan is paid off with the next
payment?
9.
Your neighbor obtained a simple interest loan at 8.75 percent for 24 months. Her
previous balance was $985.28. What is the amount of interest for the next payment?
10.
Your friend obtained a personal loan of $8,500.00 at 12.5 percent for 30 months. The
monthly payment is $331.37. The balance of the loan after 9 months is $6,221.26. What
is the new principal after the tenth payment?
11.
Steve Crawford obtained an 18-month loan for $2,500.00 to pay for a new roof. The
bank’s finance charge is $206.85. What is the APR? Use the chart below to answer this
question.
APR
Term
10.00
%
10.25
%
6
12
18
24
$2.94
$5.50
$8.10
$10.7
5
$3.01
$5.64
$8.31
$11.0
2
10.50 10.75 11.00 11.25 11.50 11.75 12.00
%
%
%
%
%
%
%
Finance Charge per $100.00 of Amount Financed
$3.08 $3.16 $3.23 $3.31 $3.38 $3.45 $3.53
$5.78 $5.92 $6.06 $6.20 $6.34 $6.48 $6.62
$8.52 $8.73 $8.93 $9.14 $9.35 $9.56 $9.77
$11.3 $11.5 $11.8 $12.1 $12.4 $12.7 $12.9
0
8
6
4
2
0
8
12.25
%
$3.60
$6.76
$9.98
$13.26
12.
Sue Jones sees a convertible for sale at a local car lot. The base price is $18,526.00. The
total for factory-installed options is $2,897.00. The destination charge is $250.00. What is
the sticker price?
13.
Car dealer Brad Bowman pays 85 percent of a car’s base price of $28,560.00, 95 percent
of the options price of $5,490.00, plus a destination charge of $425.00. What is the
dealer’s cost for the car?
14.
While on the Internet, you find that the base price of a new car your family would like to
purchase is $32,587.00. The options total $3,289.41, and the destination charge is
$275.00. You also find out that the dealer pays about 94 percent of the base price and 97
percent of the total options. What should you estimate as the dealer’s cost for the car?
15.
Jeff Bordon found a three-year-old sports car advertised for $22,500.00. Its average retail
value is $21,000.00. It has a stereo system valued at $700.00 and a $150.00 theft recovery
system. Because the vehicle has high mileage, $300.00 can be deducted. What is the
average retail price for this vehicle?
16.
If your annual base insurance premium is $2,330.00 and your driver-rating factor is 1.25,
what is your annual premium?
17.
For 100/300 bodily injury limits and $100,000.00 property damage limits, your base
premium is $337.00. The base premium is $122.50 for $50-deductible comprehensive
insurance and $289.26 for $50-deductible collision insurance. What is your annual base
premium?
18.
For the past two years, you have recorded the costs of operating your car. The fixed costs
totaled $1,109.56 and the variable costs totaled $1,877.39. You drove the car 25,379
miles. What was the cost per mile for you to operate the car?
19.
Your teacher purchased a car for $26,895.00 two years ago. He drove it 18,236 miles and
kept a record of his expenses. His variable costs were $2,368.00. His fixed costs for
insurance and license were $1,856.00. He estimates the car’s present value at $15,250.00.
What was his cost per mile for him to operate this car?
20.
You recently leased a new car. Your payments are $352.00 per month for 36 months.
Your deposit was $2,500.00. You paid a title fee of $80.00 and a license fee of $36.00.
What is your total lease cost?
21.
Kim Peterson rented a car for 8 days at $32.99 per day, plus $0.28 per mile. To protect
herself in case of an accident, she purchased the collision waiver for $10.00 per day and
paid $75.00 for gasoline to cover the 732 miles she drove. What was her total cost to rent
the car?
22.
Jessica Kline leased a car. She must pay 48 monthly payments of $218.00, no deposit, a
$90.00 title fee, and a $24.00 license fee. What is her total lease cost?
23.
Zelda John has found a home she would like to purchase and the seller accepts her offer
of $185,450.00. If Zelda makes a down payment of 8 percent, what is the amount of her
mortgage loan?
Use the following chart to answer questions 24, 25, and 26.
Monthly Payment for a $1,000.00 loan
Interest
Length of Loan in Years
Rate
20
25
30
6.00%
$7.16
$6.44
$6.00
6.50%
$7.46
$6.75
$6.32
7.00%
$7.75
$7.07
$6.65
7.50%
$8.06
$7.39
$6.99
8.00%
$8.36
$7.72
$7.34
8.50%
$8.68
$8.05
$7.69
24.
Clair and Sam Tresco purchased a vacation home for $95,000.00. The bank required a 5
percent down payment. The rest was financed at 6 percent for 20 years. What is the
amount of their monthly payment?
25.
Doug and Sheila Waters agreed upon the price of $156,300.00 for their first home. They
plan to make a 15 percent down payment and finance the rest at 6.5 percent for 30 years.
What is the total amount, excluding their down payment, to be paid?
26.
Misty Billings and her husband decide to purchase a townhouse for $189,000.00. The
lender requires a 3 percent down payment for a 30-year loan at 7.5 percent. At the end of
the 30 years, what will be the total amount of interest charged?
27.
Meagan Morgan agreed to purchase a house for $125,200.00. Keystone Mortgage is
willing to lend her money at 8 percent for 25 years provided Meagan can make a down
payment of $5,000.00. The total closing costs are 3 percent of the amount of the
mortgage loan. What is the total of the closing costs?
28.
Shelly Morrison obtained a 20-year, $117,000.00 mortgage, with an interest rate of 6
percent. For her first payment, what is the amount of interest?
29.
Barb Miller obtained a mortgage loan for $236,510.00 at 7 percent for 20 years. Her
monthly payment is $1,833.65. How much of the first payment is for principal?
30.
Kelly Cooper’s home in Bloomsburg, Pa, has an assessed value of $33,500.00. The tax
rate where she lives is 35.1 mills. What is her annual real estate tax?
31.
Debbie Gardner lives in Baldwin, New York, where the rate of assessment is 75 percent
and the tax rate is 24.92 mills. A tax assessor has determined that the market value of her
home is $485,000.00. What is her real estate tax for 1 year?
32.
Zach Robert’s home has an estimated replacement value of $172,000.00. He has insured
his home for 90 percent of its replacement value. What is the amount of coverage on his
home?
33.
Dan Martz’s home is insured for 100 percent of its $250,000.00 replacement value. The
home has a brick construction and has been rated fire protection class 5. What is his
annual insurance premium? Use the chart below to answer this question.
Amount of
Insurance
Coverage
$40,000
$45,000
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
$120,000
$150,000
$200,000
$250,000
$300,000
$400,000
$500,000
Homeowners Insurance Premiums
Annual Premiums for a Typical Homeowners Policy
Fire Protection Class
Brick / Masonry Veneer
Wood Frame
1-6 7-8
9
10
11
1-6 7-8
9
10
$166 $170 $225 $237 $270 $178 $183 $237 $248
173
178
233
244
280
187
191
248
260
178
183
241
254
290
190
195
254
265
191
196
259
273
313
205
211
273
287
213
216
285
299
343
225
231
299
315
241
248
328
343
394
257
265
343
363
268
276
365
384
441
289
296
384
403
298
307
407
426
490
320
329
426
449
354
364
484
508
584
381
391
508
534
459
471
625
657
755
493
506
657
692
616
633
841
884 1,017 662
680
884
931
737
754
961 1,021 1,167 780
798 1,021 1,086
879
901 1,147 1,218 1,394 931
953 1,218 1,295
1,021 1,045 1,331 1,413 1,617 1,067 1,105 1,413 1,504
1,309 1,340 1,707 1,812 2,074 1,385 1,418 1,812 1,929
11
$285
298
304
328
360
415
464
515
614
794
1,070
1,243
1,483
1,723
2,209
34.
You are considering purchasing a new home and estimate the following monthly housing
expenses: $701.56 for the mortgage payment, $52.35 for the insurance premium, $136.12
for real estate taxes, $85.13 for electricity, $44.99 for telephone service, and $42.90 for
water/sewer. What would be your total monthly housing cost?
35.
Gerry McCabe is employed by a local factory. The PPO annual premium is $6,825.00.
His employer pays 80 percent of the total cost, and Gerry’s contribution is deducted from
his paycheck. What is his biweekly deduction?
36.
Jack and Jill Hill pay 100 percent of a PPO insurance premium of $7,296.00 annually.
They also have a dental plan that costs $1,364.00 annually and a vision plan that costs
$798.00 annually. What is their total monthly premium for all their insurance?
37.
Kim Matthews is married and has a health insurance plan with the benefits shown in the
chart below. Her non-network health care costs for last year included co-payments for 9
physician visits and 4 specialist visits. Following hospital surgery, she made co-payments
for 22 physical therapy visits at $80.00 per visit, and she had 7 visits from a nurse at
$65.00 each. Her hospital admission charge was $225.00 and her hospital bill was
$8,283.49. What amount did she pay?
Health Care Benefits Schedule
Network
Annual Deductible
Hospital Charges
Home Health Care
Co-insurance/
Co-payment
Single
Family
---First 50 visits
Over 50
Physician visit
$375.00
$800.00
85%**
100%**
90%**
$10.00
NonNetwork*
$500.00
$1,750.00
65%**
90%**
90%**
$12.00
Specialist
$25.00
$30.00
Physical Therapy
First 15 visits
$15.00
75%**
Over 15 visits
80%**
70%**
Emergency Room
$60.00
$50.00
Ambulance
$30.00
$30.00
*Non-Network refers to a health care provider that doesn’t have a contract with the
health plan administrator.
**Percentage of total cost that is covered by the health care company.
38.
Roseanne Robinholt is 35 years old. She wants to purchase a $250,000.00, 5-year term
life insurance policy. The premium per $1,000.00 is $6.22. What will her annual
premium be?
39.
Cheri Kile took out a $275,000.00, 10-year term life insurance policy at age 50. The
premium per $1,000.00 was $5.32. She will be 60 years old this year. The premium per
$1,000.00 will be $8.85. What is the percent increase? Round your answer to the nearest
percent.
40.
Erica Stabler is 25 years old. She wants to purchase a limited payment policy valued at
$160,000.00 until age 65. What is Erica’s annual premium? Use the chart below to
answer this question.
Annual Premiums per
$1,000.00 of Life Insurance
Paid Up at Age 65
Age
Male
Female
20
$11.75
$10.00
25
$13.50
$11.75
30
$16.75
$13.50
35
$22.00
$17.65
40
$28.50
$24.50
45
$38.75
$33.75
50
$56.75
$46.75
55
$57.00
$50.60
41.
Lacey Drake has a health insurance plan with a $500.00 deductible. The plan covers 90
percent of her hospital charges. Lacey’s recent health care costs include $100.00 in copayments and a hospital bill of $8,375.00. What amount did she pay?
42.
Faith Albertson has a whole life insurance policy that has an annual premium of $337.00.
She wants to pay the premium semiannually. The semiannual premium is 51.5 percent of
the annual premium. What will her semiannual payments be?
43.
Phil Bailey invested $10,000.00 in a 2-year certificate of deposit that earns interest at an
annual rate of 4.15 percent compounded quarterly. The amount per $1.00 is 1.12368.
What is the total interest earned?
44.
Allison Streeter invested $2,500.00 in a 1-year certificate of deposit that earns interest at
an annual rate of 3.5 percent compounded daily. The amount per $1.00 is 1.08429. What
will the total amount be at maturity?
45.
Wayne Jacobs invested $5,000.00 in a certificate of deposit for 1 year. The certificate
earns interest at an annual rate of 6.5 percent compounded daily. The amount per $1.00 is
1.05249. What is the effective annual yield? Round your answer to the nearest hundredth
of a percent.
46.
Jay Ross purchased 625 shares of an electronics corporation stock at $33.82 per share.
His online stockbroker charged him a $35.00 commission. What was the total cost for the
stock?
47.
Sara DeFelice purchased 1,200 shares of a corporation stock at $18.72 per share. Her
stockbroker’s commission was $25.00 for fewer than 1,000 shares, or $0.03 per share for
1,000 or more. What was the total cost for the stock?
48.
You bought 210 shares of Creamery stock at $52.38 per share. The company paid annual
dividends of $2.87 per share. What was your total annual dividend?
49.
Brian Streater bought 700 shares of stock for $18,466.00. He sold the stock for $26.02
per share and paid a sales commission of $50.00. What was the profit or loss from this
sale? Your answer must indicate the amount and whether it was a profit or loss.
50.
Dolly Rogers purchased a $2,000.00 bond at the quoted price of 82
interest at a rate of 4 percent. What was the cost of the bond?
1
. The bond paid
4
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