Questions from Business Mathematics

Q: A 60-year-old woman can purchase either of the

A 60-year-old woman can purchase either of the following annuities from a life insurance company: a 30-year term annuity that will pay $367 at the end of each month or a life annuity that will pay $40...

Q: Sawchuk’s Home and Garden Centre in Toronto files monthly HST returns.

Sawchuk’s Home and Garden Centre in Toronto files monthly HST returns. The purchases on which it paid the HST and the sales on which it collected the HST for the last four months wer...

Q: $10,000 was invested in a fund earning 7.

$10,000 was invested in a fund earning 7.5% compounded monthly. How many monthly withdrawals of $300 can be made if the first occurs 3 1 2 years after the date of the initial investment? Count the fin...

Q: For $200,000, Jamal purchased an annuity that delivers

For $200,000, Jamal purchased an annuity that delivers end-of-quarter payments of $3341.74. If the undistributed funds earn 4.5% compounded quarterly, what is the term of the annuity?

Q: Nancy borrowed $8000 from her grandfather to buy a car when

Nancy borrowed $8000 from her grandfather to buy a car when she started college. The interest rate being charged is 4.5% compounded monthly. Nancy is to make the first $200 monthly payment on the loan...

Q: Twelve years ago, Mr. Lawton rolled a $17,

Twelve years ago, Mr. Lawton rolled a $17,000 retiring allowance into an RRSP that subsequently earned 10% compounded semiannually. Three years ago he transferred the funds to an RRIF. Since then, he...

Q: Novell Electronics recently bought a patent that will allow it to bring

Novell Electronics recently bought a patent that will allow it to bring a new product to market in 2 1 2 years. Sales forecasts indicate that the product will increase the quarterly profits by $28,000...

Q: Helen and Morley borrowed $20,000 from Helen’s father to

Helen and Morley borrowed $20,000 from Helen’s father to make a down payment on a house. The interest rate on the loan is 8% compounded annually, but no payments are required for two years. The first...

Q: A property development company obtained a $2.5-million

A property development company obtained a $2.5-million loan to construct a commercial building. The interest rate on the loan is 10% compounded semiannually. The lender granted a period of deferral, m...

Q: Bernice is about to retire with $139,000 in her

Bernice is about to retire with $139,000 in her RRSP. She will make no further contributions to the plan, but will allow it to accumulate earnings for another six years. Then she will purchase an annu...