08. For an interest rate of 2% per quarter, compounded continuously, the effective semiannual interest rate is closest A. Less than 4.0% to Formula used: 09. B. 4.02% C.4.12% D. Over 4.25% A steel fabrication company invested $500,000 in a new shearing unit. The company obtains a monthly net income of $25,000. If the company uses a minimum acceptable rate of return of 18% per year, compounded monthly, the equivalent payback period for this investment would be closest to: B. 4 years C. 3 years D. 2 years A. 5 years Formula used: 10. What is the IRR on the following cash flow? EOY: 0 CASH FLOW (S) 4,000 1 1,200 2 1,200 3 1,200 4 1,200 B. 6.62% C. 7.62% D. 7.72% E. 8.72% A. 5.62% Formula used: 11. A steel fabrication company invested $900,000 in a new shearing unit. The company obtains a monthly net income of $17,600. If the company uses a minimum acceptable rate of return of 12% per year, compounded monthly, the equivalent payback period for this investment would be closest to: A. 7 years Formula used: 12. B. 6 years C. 5 years D. 4 years E. 3 years Sixty monthly deposits are made into an account paying 6% nominal interest compounded monthly. If the objective of these deposits is to accumulate $100,000 by the end of the fifth year, what is the amount of each deposit? B. $1,695 C. $1,667 D. $1,478 E. $1,430 A. $1,930 Formula used: 13. Energy costs for a certain process have been increasing uniformly for 5 years. f the cost in year I was $5,000 and it increased by $1,000 per year through year 5, the present value of the costs at 10% annual interest rate is closest to: A. $17,900 B. $20,500 D. $25,800 E. $30,000 Formula used: 14. C. $22,100 A uniform gradient series shows payments of $500 in first year, $600 in second year, $700 in the third year, and so on, with a total of 15 payments. If the annual interest rate is 8%, what single lump sum amount at the end of the 8 year would be equivalent to the uniform gradient series? A. $16,785 B. $8,864 C. $7,922 D. $44,312 Formula used: 15. The present worth of an increasing geometric gradient is $23,632. The interest rate is 6% per year, and the rate of change is 4% per year. If the cash flow amount in year 1 is $3000, the year in which the gradient ends is year: A. 7 B. 9 C. 11 D. 12 Formula used: