Name Date MATH 1332 - REVIEW 2 SHORT ANSWER. Write the word or phrase that best completes each stateme or aswers the questio. Express the fractio as a perce. 1) 3 8 Write the decimal as a perce. 2) 0.775 Express the perce as a decimal. 3) 870% Solve the problem. 4) 75% of 144 is what umber? 5) What umber is 34% of 28? 6) 119 is what perce of 70? 7) Jeas with a origial price of $48 are o sale at 25% off. What is the sale price of the jeas? (Roud to the earest ce, if ecessary.) 8) A dress regularly sells for $104. The sale price is $79. Fid the perce decrease of the sale price from the regular price. Fid the gross icome, the adjusted gross icome, ad the taxable icome. 9) A taxpayer eared wages of $61,300, received $870 i ierest from a savigs accou, ad coributed $2100 to a tax-deferred retireme pla. He was eitled to a persoal exemptio of $3500 ad had deductios totalig $5600. 1
Use the table to calculate the tax owed. Roud to the earest ce. 10) Married couple filig joily with two depede childre Gross icome: $94,000 Adjustmes: oe Deductios: $12,000 mortgage ierest $5000 charitable coributios $2500 stude loa ierest Tax credit: $2000 2
Use the tables below to solve the problem. Roud dollar amous to the earest ce ad perces to the earest teh. 11) You decide to work part-time at a local supermarket. The job pays $8.60 per hour ad you work 24 hours per week. Your employer withholds 10% of your gross pay for federal taxes, 5.65% for FICA taxes, ad 5% for state taxes. (a) What is your weekly gross pay? (b) How much is withheld per week for federal taxes? (c) How much is withheld per week for FICA taxes? (d) How much is withheld per week for state taxes? (e) What is your weekly et pay? (f) What perceage of your gross pay is withheld for taxes? The pricipal P is borrowed at simple ierest rate r for a period of time t. Fid the loa's future value, A, or the total amou due at time t. Roud aswer to the earest ce. 12) $110, r = 3%, t = 3 years Determie the prese value, P, you must ivest to have the future value, A, at simple ierest rate r after time t. Roud aswer to the earest dollar. 13) A = $9000, r = 9.2%, t = 7 years 3
The pricipal represes a amou of moey deposited i a savigs accou subject to compoud ierest at the give rate. Fid how much moey will be i the accou after the give umber of years (Assume 360 days i a year.), ad how much ierest was eared. A = P A A = Pe rt Y = 14) Pricipal: $7000 Rate: 4% Compouded: quarterly Time: 5 years Solve the problem. A = P A A = Pe rt Y = 15) Brad was to have $17,000 available to buy a car i 5 years. How much must he deposit ow at 9% compouded mohly to reach that goal? Determie the effective aual yield for each ivestme. The select the better ivestme. Assume 360 days i a year. Roud to the earest hudredth of a perce whe ecessary. A = P A A = Pe rt Y = 16) 8.4% compouded semiaually; 8.3% compouded daily Solve the problem. Roud to the earest dollar. 17) Suppose that at age 25, you decide to save for retireme by depositig $95 at the ed of every moh i a IRA that pays 6.25% compouded mohly. How much will you have from the IRA whe you retire at age 65? Fid the ierest. Determie the periodic deposit. Roud up to the earest dollar. How much of the fiacial goal comes from deposits ad how much comes from ierest? A = P[(1 + r)t ] r A = P r A r 18) Periodic Deposit: $? at the ed of each moh Rate: 7.5% compouded mohly Time: 3 years Fiacial Goal: $18,000 4
Solve the problem. Roud to the earest dollar. 19) Suppose that betwee the ages of 29 ad 45, you coribute $5000 per year to a 401(k) ad your employer coributes $2500 per year o your behalf. The ierest rate is 8.4% compouded aually. (a) What is the value of the 401(k), rouded to the earest dollar, after 16 years? (b) Suppose that after 16 years of workig for this firm, you move o to a ew job. However, you keep your accumulated retireme fuds i the 401(k). How much moey, to the earest dollar, will you have i the pla whe you reach age 65? (c) What is the differece betwee the amou of moey you will have accumulated i the 401(k) ad the amou you coributed to the pla? P r Use PMT = 1 - -. Roud to the earest dollar. 20) Suppose that you borrow $15,000 for a ew car. You ca select oe of the followig loas, each requirig regular mohly paymes: Istallme Loa A: three-year loa at 5.8% Istallme Loa B: five-year loa at 6.8%. Fid the mohly paymes ad the total ierest for both Loa A ad Loa B. Compare the mohly paymes ad the total ierest for the two loas. Determie whether the stateme is true or false. 21) If you have to make a fixed payme based o the car's residual value, the you have made a ope-ed lease agreeme. 22) Oe advaage of leasig is that you ca usually afford to lease a more expesive car tha you would be able to buy. 23) Liability isurace pays for damage or loss of your car if you are i a accide. 24) Comprehesive coverage protects you from the cost of lawsuits, damage to other cars, acts of ature ad basically ay kid of loss associated with uexpected eves. P r Use PMT = 1 - -. Roud to the earest dollar. 25) Suppose you are thikig about buyig a car ad have arrowed dow your choices to two optios: The ew-car optio: The ew car costs $26,000 ad ca be fiaced with a four-year loa at 6.19%. The used-car optio: A two-year old model of the same car costs $17,000 ad ca be fiaced with a four-year loa at 6.82%. What is the differece i mohly paymes betwee fiacig the ew car ad fiacig the used car? 5
Fid the gross icome, the adjusted gross icome, ad the taxable icome. Base the taxable icome o the greater of a stadard deductio or a itemized deductio. 26) Suppose your fried eared wages of $93,260, received $1340 i ierest from a savigs accou, ad coributed $6300 to a tax-deferred retireme pla. She is eitled to a persoal exemptio of $3500 ad a stadard deductio of $7800. The ierest o her home mortgage was $4500, she coributed $2500 to charity, ad she paid $1359 i state taxes. Use the table to calculate the tax owed. Roud to the earest ce. 27) a head of household with a taxable icome of $75,000 ad a $4500 tax credit The pricipal P is borrowed at simple ierest rate r for a period of time t. Fid the simple ierest owed for the use of the moey. Assume 360 days i a year ad roud aswer to the earest ce. 28) $2000 r = 7% t = 1 year The pricipal P is borrowed ad the loa's future value, A, at time t is give. Determie the loa's simple ierest rate, r, to the earest teh of a perce. 29) $140, A = $190.40, t = 4 years Determie the prese value, P, you must ivest to have the future value, A, at simple ierest rate r after time t. Roud aswer to the earest dollar. 30) A = $5500, r = 10%, t = 1 year 6
Aswer Key Testame: TEST 2 FALL2018 1) 37.5% 2) 77.5% 3) 8.7 4) 108 5) 9.52 6) 170% 7) $36.00 8) 24% 9) $62,170; $60,070; $50,970 10) $6025.00 11) (a) $206.40 (b) $20.64 (c) $11.66 (d) $10.32 (e) $163.78 (f) 20.6% 12) $119.90 13) $5474 14) amou i accou: $8541.33; ierest eared: $1541.33 15) $10,857.89 16) 8.58%; 8.65%; 8.3% compouded daily 17) $202,532; $156,932 18) $447; $16,092 from deposits ad $1908 from ierest 19) (a) The value of the 401(k) after the 16 years is approximately $235,241. (b) You will have approximately $12,244,691 i the 401(k) whe you reach age 65. (c) $12,164,691 20) Loa A: $455, $1380; Loa B: $296, $2760; The mohly payme is lower with the loger-term loa but the total ierest is less with the shorter-term loa. 21) True 22) True 23) False 24) False 25) $207 26) $94,600; $88,300; $76,441 27) $8895.00 28) $140 29) 9% 30) $5000 7