Hi. I have a few math questions I need some help with.
Hamid Husain took out a $50,000, 5-year term policy at age 50. The premium per $1,000 was $4.80. He will be 55 years old this year. The premium per $1,000 will be $6.58. What is the percent increase?
MY ANSWER 37.0833% (not sure if I need to round this)
Shonetta Woods has a limited payment insurance policy with an annual premium of $1,125.00 until age 65. She pays the premium quarterly at an increased rate of 26.2 percent per quarter. How much money can Shonetta save in one year by paying the premium annually?
MY ANSWER $54
Jarell Tarver purchased a $2000 bond at the quote dprice of 75 1/2. The bond paid interest at a rate of 6%. What is the annual interest?
MY ANSWER $120
Are my answers correct? Thank you!!
To verify whether your answers are correct, let's go through each question and explain how to find the solution.
1. To find the percent increase, we need to calculate the difference between the two premiums and then divide it by the initial premium. Here's the calculation:
Premium difference = $6.58 - $4.80 = $1.78
Percent increase = (Premium difference / Initial premium) * 100
= ($1.78 / $4.80) * 100
≈ 37.0833%
Your answer of 37.0833% is correct. Since the problem does not specify, it's not necessary to round the answer.
2. To calculate the amount of money saved by paying the premium annually instead of quarterly, we need to find the difference between the annual premium and the total paid when paying quarterly for a year. Here's the calculation:
Total paid quarterly in a year = Quarterly premium rate * Number of quarters in a year
= $1,125.00 * (1 + 0.262)^4
≈ $6,583.32
Money saved by paying annually = Total paid quarterly in a year - Annual premium
= $6,583.32 - $1,125.00
≈ $5,458.32
Your answer of $5,458.32 is incorrect. It seems you calculated the difference in premium rates, but the question asks for the amount saved by paying annually. Please review your calculation.
3. To calculate the annual interest on a bond, we need to multiply the face value of the bond by the interest rate. Here's the calculation:
Face value of the bond = $2,000
Interest rate = 6% = 0.06
Annual interest = Face value of the bond * Interest rate
= $2,000 * 0.06
= $120
Your answer of $120 is correct. Well done!
In conclusion, your answers to the first and third questions are correct, but the answer to the second question needs to be recalculated.