If you buy a television for $650 and agree to pay for it with 24 monthly payments of $33, beginning next month, what annual interest rate, compounded monthly, are you being charged?
Answer(s): E
On the BAII Plus, press 24 N, 650 PV, 33 +/- PMT, 0 FV, CPT I/Y. Then press x 12 = to see the answer. On the HP12C, press 24 n, 650 PV, 33 CHS PMT, 0 FV, i. Then press 12 x to see the answer. The last multiplication by 12 is needed since the calculator returns the periodic interest rate. Make sure the BAII Plus has the P/Y value set to 1.
Suppose we select every fifth invoice in a file. What type of sampling is this?
Answer(s): D
One of the ways to conduct systematic sampling is to have a rule for picking the sample in an unbiased way.Selecting items at specified intervals can achieve this.
What single deposit could you make today in order to have $500,000 in 30 years, assuming it earns interest at 9% per year, compounded monthly?
On the BAII Plus, press 360 N, 9 divide 12 = I/Y, 0 PMT, 500000 FV, CPT PV. On the HP12C, press 360 n, 9 ENTER 12 divide i, 0 PMT, 500000 FV, PV. Note that the answer is displayed as a negative number. Make sure the BAII Plus has the value of P/Y set to 1.
Suppose you were given $4,000 today and deposited it into an account paying 8% per year, compounded monthly. If you know that you will need $5,000 in the account 6 years from now, what monthly withdrawal can you make from the account, beginning one month from now, that will leave the account with exactly $5,000 in it in 6 years?
Answer(s): B
On the BAII Plus, press 72 N, 8 divide 12 = I/Y, 4000 PV, 5000 +/- FV, CPT PMT. On the HP12C, press 72 n, 8 ENTER 12 divide i, 4000 PV, 5000 CHS FV, PMT. Note that the answer is a negative number. This is because it is a withdrawal from the account balance, just as the $5,000 is. It is a very small value because most of the $4,000 is needed to ensure there is $5,000 in the account in 6 years! Make sure the BAII Plus has the value of P/Y set to 1.
The mean amount spent by a family of four on food per month is $500 with a standard deviation of $75. Assuming that the food costs are normally distributed, what is the probability that a family spends less than $410 per month?
Answer(s): A
z = (X - u)/sigma = (410 - 500)/75=-1.2. z = 1.2 is 0.3849. Since 410 is below the mean, 1.0 - 0.8849 = 0.1151.
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