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# Fm Exam

Question | Answer |
---|---|

Equivalent Level annual effective rate? Over ten years? | a( t ) = ( 1 +i)^t t= 10, Solve ; a(10) = , then solve for i , a(10) = (1+i)^10 |

Important Things to Know about Interest Problems... | 1) always two step faway 2) Need quadratic formula |

Calculate for Annual Nominal rate of i, quarterly, Meaning? | solve for i^(4) |

Given Many different Interests rates a questions is Annual effective over n ? | Multiply then all together just like a geometric representation of compound interest, then square root (1/n) n is the number of years |

Integral of 1/(1-t) ? | - ln (1-t) If in force of Interest, it's raised ^(-1) so flip it |

-ln(a/b) = ....? | - ln (a/b) ==== ln (a/b)^-1 ==== ln (b/a) |

Consider a deposit, p at t(0) and P at t(3) but Interest changes at t(3) ? How would you build that equation ? | (p(1=i)^2 +P)(1+I)^n |

Nominal Rate of Interest (10%) Numerically equal to δ. Meaning? | i^(m) = 10% ,so NUMERICALLY Equal, = δ =10% Solve accordingly |

Total Interest Earned = 9 , Solve for t , write out equations? | PV(1+i)^n -PV = 9 |

When presented with A = 2B at t(m) and A(n) + B(n) = #. WTD? | Build you equations and solve use substitution to solve for one missing Variable. |

1 year (5%) semiannually for 5 years > 4 years (7%) Semiannually and 1 year (5%) Semiannually, TRUE OR FALSE | False |

a[n]i , what is n? | n = Number of payments |

Created by:
Elzbane