EME 460 Quiz Exam Questions
1.For the year series of values shown on the following time diagram and a 12% annual interest rate, please find:
!
Present value at year 0
A) 5,178
B) 4,869
C) 4,582
D) 4,314
!
2.For the year series of values shown on the following time diagram and a 11% annual interest rate, please find:
!
!
Future value at year 10
A) 12,672
B) 13,046
C) 13,431
D) 13,825
!
3.For the year series of values shown on the following time diagram and a 10% annual interest rate, please find:
!
!
Annual equivalent value for the 10 years
A) 874.7
B) 858.7
C) 842.7
D) 826.8
!
4.In the year timeline series shown below, using a 9% annual interest rate, please find:
!
!
Present value at year 0
A) 8,305
B) 7,910
C) 7,543
D) 7,200
!
5.In the year timeline series shown below, using a 12% annual interest rate, please find:
!
!
Future value at year 10
A) 19,661
B) 20,517
C) 21,417
D) 22,362
!
6.In the year timeline series shown below, using a 10% annual interest rate, please find:
!
!
Annual equivalent value for the 10 years
A) 1,287
B) 1,281
C) 1,274
D) 1,268
!
7.An annual nominal interest rate of 10% is compounded quarterly. What is the interest rate per quarter?
A) 10%
B) 2.5%
C) 5%
D) 10.38%
!
8.An annual nominal interest rate of 8% is compounded quarterly. What is the effective interest per year?
A) 7.86%
B) 8%
C) 8.24%
D) 8.42%
!
9.If you borrow $60,000 at an annual interest rate of 10% compounded monthly, calculate the equal monthly payments that will pay off this loan over five years
A) 1334.7
B) 1304.5
C) 1274.8
D) 1245.5
!
10.If you borrow $60,000 at an annual interest rate of 12% compounded monthly, calculate the equal yearly payments that will pay off this loan over five years
A) 16,926.9
B) 17,394.4
C) 17,871.1
D) 18,356.8
!
11.What future amount of money will be accumulated 15 years from now by investing $5,000 now plus $2,000 in year five at 10% interest compounded quarterly?
A) 31,381.0
B) 27,369.1
C) 23,871.1
D) 20,821.2
!
12.What are the monthly payments that will pay off a $1,000,000 oil rig loan with 24 equal end-of-payments? If 10% annual nominal interest rate is compounded monthly.
A) 47,073.5
B) 46,607.8
C) 46,144.9
D) 45,684.7
!
13.A $2,000 bond matures in 20 years and pays semi-annually interest of $85. What Nominal rate of return (or annual bond ROR) compounded semi-annually does the bond yield if you pay $1,800 for it and hold it until maturity? Assume that the analysis is made on the first day of a new semi-annual period.
A) 5.5%
B) 5.25%
C) 5%
D) 4.85%
!
14.A gold mining project has an initial cost of $130,000 and an estimated salvage value after 15 years of $80,000. Estimated average annual revenues are $25,000. Estimated average annual costs are $15,000. Assuming that annual revenue and cost are uniform, what is the prospective rate of return?
A) 8.21%
B) 7.56%
C) 6.88%
D) 6.05%
!
15.A new project requires development costs of $60 million at the time zero and $100 million at the end of year 2 with incomes of $40 million per year at the end of years 1, 2 and 3 and incomes of $85 million per year at the end of years through years 4 through 10 with zero salvage value predicted at the end of year 10. What is the rate of return for this project?
A) 48.05%
B) 49.6%
C) 51.1%
D) 53.8%
!
16.Calculate the present worth cost of service for the following cash flows. Use annual compounding periods and the appropriate effective annual interest rate that is equivalent to 10% compounded monthly.
!
14,246.3
14,123.0
14,002.6
13,884.9
-
Rating:
/5
Solution: EME 460 Quiz Exam Questions with Answers Only