Math 1324 - Practice Exam 1 - Fall18

MULTIPLE CHOICE SECTION. (5 pts each) Choose the correct answer for each question. Select one choice only. No
work will be graded. No partial credit.

Use I = Prt for simple interest to find the indicated quantity.

1) P = $3000; t = 90 days; I = $105. Find r. (Use 360 days in a year.) 1)
A) 14.0% B) 14.2% C) 9.7% D) 3.5%

Find the compound amount for the deposit. Round to the nearest cent.
2) $1400 at 12% compounded quarterly for 6 years 2)
A) $2763.35 B) $2408.00 C) $1671.67 D) $2845.91

Solve the problem. Round to the nearest cent as needed.

3) Cara knows that she will need to buy a new car in 3 years. The car will cost $15,000 by then. How 3)
much should she invest now at 12%, compounded quarterly, so that she will have enough to buy a
new car?
A) $11,957.91 B) $12.594.29 C) $10,520.70 D) $9532.77

What is the annual percentage yield (APY) for money invested at the given annual rate? Round results to the nearest
hundredth of a percent.
4) 6% compounded quarterly 4)
A) 6.00% B) 6.14% C) 6.18% D) 6.09%

Find the future value of the ordinary annuity.

5) PMT = $7,500, i = 8% interest compounded semiannually for 7 years 5)
A) $124,701.28 B) $148,769.47 C) $324,689.33 D) $137,189.33

Solve the problem. Round to the nearest cent.

6) Larry wants to start an IRA that will have $930,000 in it when he retires in 25 years. How much 6)
should he invest semiannually in his IRA to do this if the interest is 6% compounded
semiannually?
A) $8244.91 B) $8231.91 C) $25,507.92 D) $6241.76

Find the monthly house payment necessary to amortize the following loan.
7) In order to purchase a home, a family borrows $70,000 at 12% for 15 years. What is the monthly 7)
payment?
A) $902.99 B) $700.00 C) $840.12 D) $46.67

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Find the system of equations to model the problem. DO NOT SOLVE THIS SYSTEM.
8) A $124,000 trust is to be invested in bonds paying 9%, CDs paying 8%, and mortgages paying 10%. 8)
The sum of the amount invested in bonds and the amount invested in CDs must equal the
mortgage investment. To earn an $11,400 annual income from the investments, how much should
the bank invest in each?
Let x represent the amount invested in bonds, y the amount invested in CDs, and z the amount
invested in mortgages.
A) x + y - z = 0 B) x + y + z = 0
x + y + z = 124,000 x + y - 9z = 124,000
9x + 8y + z = 11,400 0.1x + 0.08y - 0.09z = 11,400
C) x + y - z = 11,400 D) x + y - z = 0
x - y + 9z = 22 x + y + z = 124,000
8x + y + z = 124,000 0.09x + 0.08y + 0.1z = 11,400

User row operations to change the matrix to reduced form.

1 -1 0 1
9) 0 4 8 4 9)
0 00 0
1 -1 0 1 10 2 2 102 2 102 0
A) 0 1 2 1 B) 0 1 2 1 C) 0 1 2 0 D) 0 1 2 1
0 00 0 0 00 0 000 0 000 0

State whether the matrix is in reduced form or not in reduced form.

10) 1 -5 0 0 1 10)
0 0120
A) Reduced Form B) Not Reduced Form

Perform the operation, if possible.

11) A = 3 0 , B = 3 -2 1 . Find BA. 11)
-2 3 0 4 -1
A) B) BA is not defined.
9 -6 3
-6 16 -5

C) D)
9 -6 9 0
-6 16 0 12
3 -5

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Find the inverse, if it exists, of the given matrix.
0 2 2
12) A = -1 0 7 12)
0 3 0
A) B)
7 1 7 7
0 -1 -
2 2 2 3
-1 0 0 1
0 0
7 1 1 3
- -
3 3 3 1 1
0 -
2 3
C) Does not exist D)
7 7
- -1 -
2 3
1 1
- 0
3 3
1
0 0
2

SHORT ANSWER SECTION. (6 pts each) Write the answer in the box. Write the FINAL ANSWER ONLY. No work will
be graded. No partial credit.

Solve the problem. Round to the nearest cent.

13) Joe wants to start an SEP-IRA that will have $460,000 in it when he retires in 15 years. How 13)
much should he invest semiannually in his IRA to do this if the interest is 15% compounded
semiannually?

Answer:

Solve the problem.

14) Sammy borrowed $10,000 to purchase a new car at an annual interest rate of 11%. She is to 14)
pay it back in equal monthly payments over a 5-year period. How much total interest will be
paid over the period of the loan? Round to the nearest dollar.

Answer:

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Find the periodic payment that will render the sum.
15) FV = $17,000, interest is 8% compounded monthly, payments made at the end of each month 15)
for 3 years

Answer:

Solve the problem.

16) What is the future value of an ordinary annuity at the end of 3 years if $200 is deposited each 16)
quarter into an account earning 6% compounded quarterly?

Answer:

17) A couple decides on the following savings plan for their child's college education. When 17)
the child is 6 months old, and every 6 months thereafter, they will deposit $310 into a
savings account paying 9.5% interest compounded semi-annually. After the child's tenth
birthday, having made 20 such payments, they will stop making deposits and let the
accumulated money earn interest, at the same rate, for 8 more years, until the child is 18
years old and ready for college. How much money (to the nearest dollar) will be in the account
when the child is ready for college?

Answer:

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ESSAY SECTION. (5 pts each) Show all work to justify your answer. Answer with no work or insufficient work will
receive no credit. Partial credit may be given.

Find the system of equations to model the problem. Then use a matrix to solve the system for x, y and z.
18) Hurst's Feed & Seed sold to one customer 5 bushels of wheat, 2 of corn, and 3 of rye, for $31.00. To another
customer he sold 2 bushels of wheat, 3 of corn, and 5 of rye, for $27.60. To a third customer he sold 3 bushels of
wheat, 5 of corn, and 2 of rye for $32.70. What was the price per bushel for each of the different grains?
Let x represent the price per bushel for wheat, y the price per bushel for corn, and z the price per bushel for
rye.

Solve the problem.

19) Linda invests $25,000 for one year. Part is invested at 5%, another part at 6%, and the rest at 8%. The total
income from all 3 investments is $1600. The income from the 5% and 6% investments is the same as the income
from the 8% investment. Find the amount invested at each rate.

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Answer Key
Testname: 1324-PRACTICETEST1-FALL18

1) A
2) D
3) C
4) B
5) D
6) A
7) C
8) D
9) B
10) A
11) B
12) B
13) $4448.77
14) $3045
15) $419.38
16) $2,608.24
17) $20,978
18) 5x + 2y + 3z = 31.00
2x + 3y + 5z = 27.60
3x + 5y + 2z = 32.70
19) $10,000 at 5%, $5000 at 6%, $10,000 at 8%