SOLUTION: Help
1. When interest is added to the principal and interest is again calculated on the new balance, the process is known as compound interest.
True
Algebra.Com
Question 198170: Help
1. When interest is added to the principal and interest is again calculated on the new balance, the process is known as compound interest.
True
False
2. The terms of a loan indicate how often interest is compounded.
True
False
3. A compound interest table shows the compounded amount per dollar of principal.
True
False
4. To compound daily means to compound 360 times a year.
True
False
5. The number of compounding periods for $6,600.00 at 12% compounded quarterly for 15 years is 30 periods.
True
False
6. The effective rate of a transaction can be calculated by dividing the interest for one year by the principal.
True
False
7. The term "nominal rate" means the same as "true rate."
True
False
8. The interest on $4,200.00 at 8% compounded semiannually for 10 years is $6,292.40.
True
False
9. In a loan of 8% compounded quarterly, what is the periodic interest 2.5%
6%
2%
4%
10. Present value does not:
find the present dollar amount
use the tables
know the present dollar amount
know the future value
none of the above
11. The effective rate is:
the interest for one year divided by the principal
the interest for one year divided by the principal for three years
the interest for one year divided by the annual rate
never related to the compound table
none of the above
Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
Post you answers with the problems and you
may get some help.
Also: the amswer to some of your questions
can only be found in your text book.
-----------------------------------------
Cheers,
Stan H.
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