FINANCIAL ALGEBRA TEST 3

Aaron wants to know how much he needs to save each month in his savings account to have a certain amount in the future. He should use the formula for present value of a periodic deposit investment. : False

Interest compounded semiannually is compounded four times a year. : False

Tamika opened a money market account that has a 4.25% annual interest rate, compounded annually. She deposits $1,750 into the account each year. How much interest will the account earn after 15 years? : $33,949.40

James and Terry open a savings account that has a 2.75% annual interest rate, compounded monthly. They deposit $500 into the account each month. How much will be in the account after 20 years? : $159,744.59

Malcolm wants to make a deposit into an account that earns interest. He wants to be able to access the money on a limited basis. What type of account should he NOT consider? : Savings account

Annual percent yield is higher than the annual percentage rate because APY takes into account the additional interest earned by compounding : True

Interest compounded semiannually is compounded four times a year. : False

LaToya has $113.94 in her checking account. During the week she goes to an ATM and withdraws $40. She is charged a usage fee of $2.50. The following week she deposits her paycheck of $189.73. She writes two checks, one for $22.50 and the other for $70.18. What is the current balance in her checking account? : $168.49

Edward wants to have $50,000 in 10 years for college. What single deposit would he need to make now into an account that pays 4.3% interest compounded daily, to meet his goal? : $32,526.28

Tyrone opens an account at the local bank by depositing $50 of his birthday money. He continues to deposit $50 each month for 5 years. If the account pays 3 1/4% interest compounded monthly how much is in the account after 5 years? : $3252.74