1. Mrs. Berry purchased $4,000 worth of furniture from a furniture store. The purchase was financed by a consumer loan which required Mrs. Berry to pay a monthly payment of $150 at the end of each month for three years. What was the annual percentage rate (APR) of the consumer loan?
1) 2.12%
2) 15.12%
3) 20.66%
4) 21.78%
5) 26.46%
2. Susan will start attending college in September 2022 at which time she will need $8,000 for the first year of study. Her costs at college for the next three years are estimated at $9,000, $10,000, and $11,000 respectively. Susan’s father plans to make equal payments to a money market fund which yields 10%, the first payment will be paid in September 2010 and the last in September 2022. What is the size of the annual payments the father must make if the fund is to supply Susan with the above estimates?
a) $1,024.53
b) $1,333.90
c) $1,529.66
d) $1,583.58
e) $1,602.30