OPMT1110 Business Math
Practice Questions for Final Exam (~2.5 hours)
1. The Burns family has received an inheritance from am eccentric, distant relative. 10% of the
relative’s estate is going to the Burns family. The mom, son, and dog will be allocated the
funds in the ratio of 4:3:1. If the son’s inheritance is valued at $75,000, what is the total value
of the distant relative’s estate?
(a) $200,000 (b) $222,222 (c) $600,000 (d) $2,000,000 (e) $6,000,000
2. 10 years ago, you bought a $1,000 GIC. It paid 5% compounded semi-annually for the first 5
years, and 6% compounded semi-annually for the next 5 years. What was the average
effective interest for the GIC over the 10 years?
(a) 5.0625% (b) 6.0900% (c) 5.5750% (d) 9.0000% (e) 5.5000%
3. A rich relative has specified that you will receive $10,000 on your 21 st birthday. You are
now exactly 18½ years old, and in need of money to pay your tuition. You approach a loan
company that agrees to lend you money now in exchange for the $10,000 on your 21 st
birthday. How much money will you receive today if the lender charges 8% compounded
quarterly?
(b) $8,203.48 (b) $8,619.83 (c) $7,686.09 (d) $8,208.79 (e) None of the Above
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, OPMT1110 Business Math
4. Deposits of $100 made at the end of every month for 30 months accumulate to $3,478.50.
What EFFECTIVE rate of interest are these deposits earning?
(a) 1% (b) 12% (c) 15.95% (d) 12.68% (e) None of the Above
5. You wish to go to Hawaii in 18 months, when you graduate from BCIT. Starting today, you
set aside $100 every month in an account that pays 8% compounded monthly. How much
interest will you earn in 18 months?
(a) $105.72 (b) $118.42 (c) $109.11 (d) $97.83 (e) None of the Above
6. A stereo system can be purchased by making a down payment of $130, followed by monthly
payments of $85 at the end of every month for 15 months. If the interest rate is 7%
compounded monthly, what is the selling price of this stereo system?
(a) $1,217.42 (b) $1,328.40 (c) $1,347.42 (d) $1,458.40 (e) None of the Above
7. Royal Canine Pet Foods sells its gourmet pet food to retailers at trade discounts of 15% and
10%. A competitor sells its pet food at the same list prices but with trade discounts of 20%
and 10%. Royal Canine wants to match the competitor’s prices by offering a third trade
discount. What third discount rate should Royal Canine offer to meet their objective?
(a) (a) 5.0% (b) 94.1% (c) 4.5% (d) 36.6% (e) 5.9%
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Practice Questions for Final Exam (~2.5 hours)
1. The Burns family has received an inheritance from am eccentric, distant relative. 10% of the
relative’s estate is going to the Burns family. The mom, son, and dog will be allocated the
funds in the ratio of 4:3:1. If the son’s inheritance is valued at $75,000, what is the total value
of the distant relative’s estate?
(a) $200,000 (b) $222,222 (c) $600,000 (d) $2,000,000 (e) $6,000,000
2. 10 years ago, you bought a $1,000 GIC. It paid 5% compounded semi-annually for the first 5
years, and 6% compounded semi-annually for the next 5 years. What was the average
effective interest for the GIC over the 10 years?
(a) 5.0625% (b) 6.0900% (c) 5.5750% (d) 9.0000% (e) 5.5000%
3. A rich relative has specified that you will receive $10,000 on your 21 st birthday. You are
now exactly 18½ years old, and in need of money to pay your tuition. You approach a loan
company that agrees to lend you money now in exchange for the $10,000 on your 21 st
birthday. How much money will you receive today if the lender charges 8% compounded
quarterly?
(b) $8,203.48 (b) $8,619.83 (c) $7,686.09 (d) $8,208.79 (e) None of the Above
Page 1 of 10
, OPMT1110 Business Math
4. Deposits of $100 made at the end of every month for 30 months accumulate to $3,478.50.
What EFFECTIVE rate of interest are these deposits earning?
(a) 1% (b) 12% (c) 15.95% (d) 12.68% (e) None of the Above
5. You wish to go to Hawaii in 18 months, when you graduate from BCIT. Starting today, you
set aside $100 every month in an account that pays 8% compounded monthly. How much
interest will you earn in 18 months?
(a) $105.72 (b) $118.42 (c) $109.11 (d) $97.83 (e) None of the Above
6. A stereo system can be purchased by making a down payment of $130, followed by monthly
payments of $85 at the end of every month for 15 months. If the interest rate is 7%
compounded monthly, what is the selling price of this stereo system?
(a) $1,217.42 (b) $1,328.40 (c) $1,347.42 (d) $1,458.40 (e) None of the Above
7. Royal Canine Pet Foods sells its gourmet pet food to retailers at trade discounts of 15% and
10%. A competitor sells its pet food at the same list prices but with trade discounts of 20%
and 10%. Royal Canine wants to match the competitor’s prices by offering a third trade
discount. What third discount rate should Royal Canine offer to meet their objective?
(a) (a) 5.0% (b) 94.1% (c) 4.5% (d) 36.6% (e) 5.9%
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