The Mathematics of Money

640 Appendix A Answers to Odd-Numbered Exercises

Chapter 3 Section 3.2

1. Quarter Start Interest End

1 $1,450.00 $21.75 $1,471.75

2 $1,471.75 $22.08 $1,493.83

3 $1,493.83 $22.41 $1,516.24

4 $1,516.24 $22.74 $1,538.98

3. a) i = 0.05/365, n = 2,920; b) i = 0.0719/4,
   n = 8; c) i = 0.0303/365, n = 365;
   d) 0.0475/12, n = 348


4. a) i = 0.0547/365, n = 3,650, $54,959.12;
   b) i = 0.025, n = 4, $3,311.44; c) i = 0.07/360,
   n = 720, $112,150.17; d) i = 0.0925/365,
   n = 13,870, $67,201.92


5. $4,102.22


6. $841.75


7. $19,267.05


8. $1,523,339.50


9. $2,423.06


10. 2 cents


11. a) $1,636.78, b) $3,595.17, c) $1,093.95,
    d) $8,427.56, e) $9,237.57, f) $1,245.33,
    g) $157,439.10, h) $3,999.61


12. $2,658.73


13. $13,786.06


14. $3,668.96


15. $3,366.59


16. Approximately 12.3 years


17. $18,998.51


18. a) $1,521.67, b) $1,787.33


19. $4,626.22


20. $3,538.18

Chapter 3 Section 3.3

1. Brockport


2. Bank C


3. First Cattaraugus


4. a) 9%, b) 9.20%, c) 9.31%, d) 9.38%,
   e) 9.42%


5. 14.13%


6. 7.64%


7. First 9.21%; Second 9.30% (highest); Third 9.12%;
   Fourth 9.21%; Fifth 9.04% (lowest)


8. Penfi eld Mutual


9. $432.89


10. $1,004.62 (rate is effective so compounding
    frequency doesn’t matter)


11. $48,440.58


12. $57,704.53; $7,704.53


13. $399,347.05


14. $223.37


15. $6,980.00


16. 1,945,425
    33. $3.30
    35. 6.55% daily  6.77% effective; 6.68% quarterly 
    6.85% effective; choose the higher effective rate.
    37. $27,761.14
    39. 5% quarterly  5.09% effective; 4.93% daily 
    5.05% effective, which would not be better.
    41. Knapp Creek
    43. 6.45%
    45. Dylan had slightly more.
    47. 6.18%

Chapter 3 Section 3.4

1. Nominal  $4,037.56; APY  $4,037.93.
   Do not match exactly, but should be close.


2. a) 5.54%, b) $5,834.79, c) $5,834.17, d) Not an
   exact match, but should be close


3. a) $53,306.11, b) 6.15%, c) $53,314.51,
   d) (a) does


4. a) $538.20; b) 10.24%, $538.21;
   c) (a) does


5. 6.49%; $5,143.93; $5,144.33

Chapter 3 Section 3.5

1. 12.40%


2. 6.71%


3. 53.09%; 18.57%; 8.89%


4. 6.72%


5. 5.22%


6. 549 days


7. 8.41%


8. 10.2 years


9. 7.07%

Chapter 3 Exercises

1. a) $5,126.94, b) $1,126.94


2. SNB Bank


3. Derby


4. 13.54%


5. Approximately $1,377.49


6. a) $882.75, b) $7,839.06


7. $635.15


8. Springwater


9. $7,311.58


10. No. Her account earned a 4.91% effective
    rate.


11. 8.31%


12. $550,998,029


13. 12%

Chapter 4 Section 4.1

1. Annuity


2. Amount varies from week to week. Not an
   annuity.


3. Annuity

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