### Chapter Review

##### Understanding Percent

1
.

Convert 0.45 to percent form.

2
.

What is 70% of 200?

3
.

Rewrite the fraction $\frac{240}{100}$ as a percentage.

4
.

20 is what percent of 500?

##### Discounts, Markups, and Sales Tax

5
.

An item with a retail price of $250.00 is on sale for 30% off. What is the sale price of the item? Round to the nearest penny.

6
.

The sales price of an item is $38.50 after a 40% discount. What was the retail price of the item? Round to the nearest penny.

7
.

A retailer buys an item for $1,000.00 and has a 65% markup. What is the retail price of the item? Round to the nearest penny.

8
.

The sale price of an item is $46.00 and the retail price is $65.00. What is the percent discount? Round to two decimal places.

9
.

The retail price of an item is $345.38 and sales tax in the region is 8.25%. How much is the sales tax?

##### Simple Interest

10
.

$3,000 is invested in a 5-year CD earning 2.25% interest. How much is the CD worth in 5 years?

11
.

A $4,000.00 simple interest loan is taken out for 3 years at 12.5%. How much is owed when the loan comes due?

12
.

A $10,000 loan with annual simple interest of 14.9% is taken out for 90 days. How much is due in 90 days?

13
.

A simple interest loan for $20,000 is taken out at 13.9% annual interest rate. A partial payment of $13,500.00 is made 30 days into the loan period. After this payment, what will the remaining balance be?

14
.

Find the present value of an investment with future value of $15,000 if the investment earns 3.55% simple interest for 10 years?

##### Compound Interest

15
.

Find the future value after 20 years of $15,000 deposited in an account bearing 4.26% interest compounded quarterly.

16
.

What is the effective annual yield for an account bearing 3.21% interest compounded quarterly? Round to two decimal places if necessary.

17
.

Find the present value of $100,000 in an account bearing 5.25% interest compounded daily after 30 years.

##### Making a Personal Budget

18
.

In budgeting, what is the difference between an expense that is a need and an expense that is a want?

19
.

Apply the 50-30-20 budget philosophy to a monthly income of $6,000.00.

20
.

Create the budget for a person with the following income and bills, and determine how much the income exceeds or falls short of the expenses:

Job = $5,250, Side job = $550, rent = $1,150.00, utilities = $150.00, internet = $39.99, student loans = $375.00, food = $550.00, bus and subway = $112.00, credit cards = $200.00, entertainment = $400.00, clothing = $150.00.

Job = $5,250, Side job = $550, rent = $1,150.00, utilities = $150.00, internet = $39.99, student loans = $375.00, food = $550.00, bus and subway = $112.00, credit cards = $200.00, entertainment = $400.00, clothing = $150.00.

21
.

In question 20, the budget for a person was created. Can the person afford to buy a car if the monthly payments will be $365.50, monthly car insurance will be $114.75, and gasoline will be $200.00?

##### Methods of Savings

22
.

Why is a CD less flexible than a money market account?

23
.

Which is likely to have the highest interest rate, a savings account, CD, or money market account?

24
.

$3,000 is deposited in a money market account bearing 3.88% interest compounded monthly. How much is the account worth in 15 years?

25
.

Refer to question 24. What is the return on investment for the money market account? Round to two decimal places, if necessary.

26
.

$300 is deposited monthly in an ordinary annuity that bears 6.5% interest compounded monthly. How much is in the annuity after 30 years?

27
.

How much must be deposited quarterly in an account bearing 4.89% interest compounded quarterly for 30 years so the account has a future value of $500,000?

##### Investments

28
.

Why is investing in a stock riskier than in a mutual fund?

29
.

Which investment offers high rates of return with reduced risk?

30
.

Which investment offer a fixed rate of return over time?

31
.

Which is the riskiest investment?

32
.

How much is earned on a 10-year bond with issue price of $1,000 that pays 3.9% annually?

33
.

Henri’s employer matches up to 6% of salary for IRA contributions. Henri’s annual income is $52,500. If Henri wants to deposit $3,000 annually in his IRA, how much in matching funds does the employer deposit in the IRA?

34
.

How much must be deposited quarterly in a mutual fund that is expected to earn 11.2% interest compounded quarterly if the account is to be worth $1,000,000 after 38 years?

35
.

Lorraine purchases stocks for $5,000. The stocks paid dividends by reinvesting the dividends in stock. She sold the stock for $13,750 after 6 years. What was Lorraine’s annual return on that investment? Round to two decimal places if necessary.

36
.

What are two ways stocks earn money?

##### The Basics of Loans

37
.

What is an installment loan?

38
.

An installment loan with monthly payments has an outstanding balance of $3,560. If the annual interest rate is 9%, how much interest will be paid that month?

39
.

A loan for $42,000 is taken out for 6 years at 7.5% interest. What are the payments for that loan?

40
.

The total interest paid on a loan was $4,500. The loan had an origination fee of $400.00, a $125.00 processing fee, and a filing fee of $250.00. How much was the cost of financing for that loan?

41
.

Using the amortization table below, what is the remaining balance after payment 25?

##### Understanding Student Loans

42
.

If a college program takes 5 years, how long is the student’s eligibility period for student loans?

43
.

What is the funding gap for a student with cost of college equal to $35,750 and non-loan financial aid of $24,150?

44
.

What is the maximum amount of federal subsidized and unsubsidized loans for a dependent student in their third year of an undergraduate data science program?

45
.

A single person has gross income of $28,500. Their poverty guideline is $12,000. What is their discretionary income?

##### Credit Cards

46
.

The billing cycle for a credit card goes from March 15 to April 14. The balance at the start of the billing cycle is $450.00. The list of transactions on the card is below. Find the average daily balance for the billing cycle.

Date | Activity | Amount |
---|---|---|

15-Mar | Billing Date Balance | $450.00 |

21-Mar | Movie | $50.00 |

28-Mar | Gasoline | $65.00 |

31-Mar | Snacks | $15.50 |

1-Apr | Dinner | $63.60 |

1-Apr | Payment | $300.00 |

1-Apr | Gasoline | $48.90 |

9-Apr | Plane Tickets | $288.50 |

47
.

The average daily balance for Greg’s last credit card statement was $1,403.50. The card charges 15.9% interest. If the billing cycle for that statement was 30 days, how much interest is Greg charged?

48
.

The billing cycle for a credit card goes from March 15 to April 14. The balance at the start of the billing cycle is $450.00. The list of transactions on the card is below. The interest rate is 15.9%. What is the balance due at the end of the billing cycle?

Date | Activity | Amount |
---|---|---|

15-Mar | Billing Date Balance | $450.00 |

21-Mar | Movie | $50.00 |

28-Mar | Gasoline | $65.00 |

31-Mar | Snacks | $15.50 |

1-Apr | Dinner | $63.60 |

1-Apr | Payment | $300.00 |

1-Apr | Gasoline | $48.90 |

9-Apr | Plane Tickets | $288.50 |

##### Buying or Leasing a Car

49
.

Name three common fees when leasing a car.

50
.

Name three common fees when buying a car.

51
.

If the cost of a car is $35,500, and the residual value of the car after 3 years is $27,800, what is the monthly depreciation for the car?

52
.

What is the annual interest rate if the money factor is 0.000045?

53
.

What is the payment for a lease on a car if the price of the car is $29,900, the residual price of the car is $16,500, the lease is for 24 months, and the APR is 8.9%?

##### Renting and Homeownership

54
.

Name two advantages of renting a residence.

55
.

Name two advantages of buying a home.

56
.

What is PMI?

57
.

What are the monthly payments for a 25-year mortgage for $165,000 at 4.8% interest, not including escrow?

58
.

What are the monthly payments, including escrow, for a 25-year mortgage for $165,000 at 4.8% interest, if the property taxes are $5,200 annually, the homeowner’s insurance is $825 every 6 months, and the PMI is $45 per month?

##### Income Tax

59
.

What is the maximum gift that a person can receive that is an exemption on federal income taxes?

60
.

Find the gross income if a person earns $51,500 at their full-time job, they earn $5,300 for contracted services, and $5,000 in gambling winnings.

61
.

Find adjusted gross income for a person with a gross income of $67,850, if they had a $2,000 gift, they paid $1,000 in mortgage interest, $4,250 in property taxes, and they contributed $750 to a qualifying charity.

62
.

How much SSI is paid by a person with an annual income of $183,500?

63
.

How much in FICA taxes are paid from a person’s paycheck with gross income of $3,450?

64
.

How much in federal income tax does a person filing single pay if their taxable income is $205,240? Use the tax table below.

Bracket | Lower Income Limit | Upper Income Limit | Tax Rate |
---|---|---|---|

1 | 0 | $10,275 | 10% |

2 | $10,276 | $41,775 | 12% |

3 | $41,776 | $89,075 | 22% |

4 | $89,076 | $170,050 | 24% |

5 | $170,051 | $215,950 | 32% |

6 | $215,951 | $539,900 | 35% |

7 | $539,901 | 37% |