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Key Quiz 8.3
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1
Sanjit wants to deposit enough money today to have $5000 for college in three years. If he can get an account paying 3.75% per year compounded annually, how much does he have to deposit?
A)$1923.27
B)$4468.77
C)$4477.19
D)$5583.86
2
What is the present value of $10 000 needed in 8 years if interest is 2.95% compounded monthly?
A)$7900.09
B)$7904.65
C)$7911.43
D)$7924.82
3
Sid has a $750 loan due in a year. His creditor is willing to let him pay it off now at an interest rate of 11% compounded monthly. How much will Sid have to pay?
A)$672.21
B)$672.88
C)$673.84
D)$836.79
4
How much should a 25 year-old deposit in an account paying 6.15% per year compounded quarterly in order to have $100 000 when retiring at 65?
A)$8507.34
B)$8704.93
C)$8866.10
D)$1 148 774.00
5
Harvey wants to buy a sofa from The Buck, a local furniture store. He has two choices:
Option A: pay $750 now
Option B: pay nothing now and $900 two years from now.
Interest is 5% compounded semi-annually. How much more expensive is Option B than Option A?
A)$66.33
B)$65.36
C)$64.52
D)Option A is more expensive.





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