## Math 160: Study Guide - Chapter 3

- Stock transaction problem. Compute the annual rate of return for the investment.
- Compound interest: Find the effective rate, find the amount, find the number of periods.
- Future value: Find the future value, find the future value, find the number of periods. For each
of the future value problems, you then have to leave the money sit and just compound.
- Future value: Find the payment.
- Present value: Find the present value.
- Retirement: Find the present value needed to retire, then find the payment needed under a
future value to reach that goal.
- Home loan: Find the down payment, how much is financed, what the monthly payment will be,
what the total payments are, what the interest is, the remaining balance after a fixed time, the
equity in the house after so many years, the time to pay off the loan if extra is paid, amount of
money saved by paying extra.

### Notes:

- Make sure the compounding period is the same as the deposit period for present value and
future value problems. If it's not, you need to adjust one to the other by finding some an
equivalent rate (effective rate if it's annually).
- The test is individual, there are no groups allowed.
- Make sure the compounding period is the same as the deposit period for present value and
future value problems. If it's not, you need to adjust one to the other by finding some an
equivalent rate (effective rate if it's annually).
- There is NO EXTRA TIME allowed after the class period.
- Have you act together when you come in to take the test. Know your material. Go through
and work the easiest problems first. Don't get bogged down on the first problem, it's one of
the longer ones (work wise).
- Make sure the compounding period is the same as the deposit period for present value and
future value problems. If it's not, you need to adjust one to the other by finding some an
equivalent rate (effective rate if it's annually).
- Show enough work so that I can give partial credit if you're wrong. That may mean just
writing down what your looking for and what you entered into the calculator for some
problems, but if there's nothing but an answer, you better make sure it's right.
- Make sure the compounding period is the same as the deposit period for present value and
future value problems. If it's not, you need to adjust one to the other by finding some an
equivalent rate (effective rate if it's annually).

Did I tell you to make sure the compounding period is the same as the deposit period for present
value and future value problems? There's at least three problems on the test you will miss if you
don't.