You are planning to save for retirement over the next 15 years. To do this, you will invest $1,100 a month in a stock

You want to buy a new sports coupe for $41,750, and the finance office at the dealership has quoted you an 8.6 percent APR loan compounded monthly for 48 months to buy the car. What is the effective interest rate on this loan?    A.  8.28 percent B.  8.41 percent C.  8.72 percent D.  8.87 percent E.  8.95 percent EAR = [1 + (.086/12)]12 - 1 = 8.95 percent

113.

Beginning three months from now, you want to be able to withdraw $1,700 each quarter from your bank account to cover college expenses over the next 4 years. The account pays 1.25 percent interest per quarter. How much do you need to have in your account today to meet your expense needs over the next 4 years?    A.  $24,514.50 B.  $24,847.15 C.  $25,068.00 D.  $25,454.09 E.  $25,711.18

114.

You are planning to save for retirement over the next 15 years. To do this, you will invest $1,100 a month in a stock account and $500 a month in a bond account. The return on the stock account is expected to be 7 percent, and the bond account will pay 4 percent. When you retire, you will combine your money into an account with a 5 percent return. How much can you withdraw each month during retirement assuming a 20-year withdrawal period?    A.  $2,636.19 B.  $2,904.11 C.  $3,008.21 D.  $3,113.04 E.  $3,406.97