# (TCO 3) Amy needs to save \$20,000

6. (TCO 3) Amy needs to save \$20,000 in cash to buy a new car five years from today. She expects to earn 6.5 percent, compounded annually, on her savings. How much does she need to deposit today, if this is the only money she saves for this purpose?

\$12,468.07

\$12,502.14

\$14,597.62

\$17,044.32

\$17,129.01

7. (TCO 3) Paper Pro needed a new store. The company spent \$65,000 to refurbish an old shop and create the current facility. The firm borrowed 75 percent of the refurbishment cost at eight percent interest for 11 years. What is the amount of each monthly payment?

\$91.05

\$284.13

\$556.50

\$682.87

\$731.60

8. (TCO 3) Amy borrowed \$5,000 from her bank three years ago. The loan term is five years. Each year, Amy must repay the bank \$1,000 plus the annual interest. Which type of loan does Amy have?

amortized

blended discount

interest-only

pure discount

complex

9. (TCO 3) Fanta Cola has \$1,000 par value bonds outstanding at 12 percent interest. The bonds mature in 25 years. What is the current price of the bond if the YTM is 16 percent? Assume annual payments.

\$1315

\$1300

\$756

\$1000

10. (TCO 6) The market where new securities are offered is called the _____ market.

primary

main

secondary

principal

dealer

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