Contemporary Mathematics

# Chapter Review

### 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.
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%
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