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BUQU 1130 – Business Mathematics
Final Exam V3
Ensure student name and number appear on the top of this question sheet.
For each question, you must write down the inputs. You can copy/paste the following set
C01 = ; F01 =
C02 = ; F02 =
C03 = ; F03 =
C04 = ; F04 =
C05 = ; F05 =
C06 = ; F06 =
Make sure you mention what you are computing.
All your answers must be shown in the space provided along the right side. Show your work
in the space below the question.
All answers must:
o Show appropriate units
o Keep everything in nine decimals, with only final answers rounded.
o Show the appropriate number of decimal places (percentages should be shown with two
decimal places as in 12.25%, money as dollars and cents as in $6.94)
Keep your rough works. I may ask random students to send their work/timelines to me.
KPU Code of honesty applies to this exam. I trust you to adhere to it, even in the strange
circumstances we are finding ourselves in. You may use your book and notes during the
exam but communication with other people/friends/classmates is not allowed.
A restaurant may be purchased for $250,000. Annual net income from the operation of the restaurant
is expected to be $61,000 for each of the first 4 years and $30,000 for each of the next three years.
After 7 years, the restaurant can be sold for $315 000. Should you purchase the restaurant, if you
require a return on investment of 15%? What if you require a return on investment of 25%?
Nima needs to decide whether to buy a Honda Civic for $22,900 with a salvage price of $7,200 after
4.5 years or lease the car for 4.5 years making monthly payments of $339 at the beginning of each
month. If money is worth 5.9% compounded annually, should Nima buy or lease?
Mr. Lamb borrowed $8321.00 at 11.12% compounded monthly. He agreed to repay the loan in
equal monthly payments over five years. Prepare a partial amortization schedule showing details of
the first three payments, the last three payments, and totals.
A sum of money is deposited at the beginning of each year for 3 years at 12% compounded
annually. After the last deposit interest for the account is to be 8.24% compounded quarterly and
the account is to be paid out by payments of $370.00, made at the beginning of each quarter for
nine years. What is the size of the annual deposit?
The sale of property provides for payments of $10 000.00 due at the beginning of every three
months for ten years. If the payments are deferred for five years and interest is 12% compounded
monthly, what is the cash value of the property?
For her daughter's university education, Carla Hackl has invested an inheritance in a fund paying
9.2% compounded quarterly. If ordinary annuity payments of $4750.00 per month are to be made out
of the fund for 5 years and the annuity begins 7.75 years from now, how much was the inheritance?