Long Term Purchases — Unit test Answers

Calculate the Social Security and Medicare tax that would be applied to an annual salary of $235,430. Use $106,800 for maximum taxable earnings.

You have a home with a market value of $144,700, which has an assessment value of 72% of that amount. Your city has a property tax rate of 0.039. You know that 65% of your property tax dollars go to public schools. To the nearest dollar, how much of your taxes went to funding schools?

Tax returns filed manually have a 20% chance of containing errors, while tax returns filed electronically have a 0.05% chance of containing the same. If 2.7 million tax returns are filed each way, how many more erroneous manually filed returns will there be than erroneous electronically filed returns?

Orlando invested $16,000 in an eight-year CD bearing 6.5% simple annual interest, but needed to withdraw $3,500 after five years. If the CD’s penalty for early withdrawal was one year’s worth of interest on the amount withdrawn, when the CD reached maturity, how much less money did Orlando earn total than if he had not made his early withdrawal?

Looking for some furniture for her new apartment, Susan visits the local swap meet in search of something cheap. Knowing that most swap meet vendors will not accept credit cards and that she will not have any money until her next payday, Susan decides to take out a $200 cash advance on her credit card at an interest rate of 32%.If Susan had no previous balance on her credit card, and she manages to pay off the balance within 1 month, how much will she have to pay in interest?

Below is a graph of the Murphys’ annual expenses. How much will the Murphys’ pay in state/local taxes if their gross annual household income is $85,420?

Harry and Helen are married, filing jointly. Their combined taxable income is $65,922. Every week, a total of $187 is withheld from their pay. Based on the table below, what can Harry and Helen expect when their taxes are due?

Rate the following bank accounts from most to least liquid: CD, savings account, checking account, money market account.

Agnes pays state income tax equal to 3.75% of her federal taxable income. She pays federal income tax equal to 28.4% of her federal taxable income. This year, she paid $15,449.60 in federal income tax. How much did Agnes pay in state income tax?

Pam has just moved into a new home and wants to purchase an oven. She expects to live in this house for the foreseeable future. She has narrowed her choices down to two options. Consider the following table, which describes the prices, daily electricity costs, and lifespans of the two ovens she is considering: Brand Brand U Brand V Price $2,250 $725 Avg. Cost/Day $0.16 $0.28 Lifespan 24 years 8 years Which brand will have the lower lifetime cost, and how much lower will it be? Hints: If the product's expected lifespans differ, assume that repurchase(s) at the same price is possible to equalize the lifespans. Remember that six of the twenty-four years will be leap years, and round all dollar values to the nearest cent.

From the statements below, identify the way or ways in which making only minimum monthly payments on a long-term credit purchase can be a disadvantage.I. It is illegal to make only the minimum payments for more than one year.II. Repeatedly making minimum payments harms your credit score.III. The total cost is higher if the length of the debt is longer.

Marilyn has two credit cards, D and E. Card D has a balance of $691.64, and Card E has a balance of $1,014.22. The minimum monthly payment on Card D is 3.57% of the total balance, and the minimum monthly payment on Card E is 2.51% of the total balance. How much greater is the minimum payment on Card E than on Card D?

Which of the following types of credits would best describe credit cards?

Fran is going to transfer her credit card balance over to a new card. She has an existing balance of $752.69. Her current card charges her a transfer fee of 12.5%, added to her balance, for transferring her debt. The new card has an opening fee of $50, which is also added to her balance. She will also have to make an immediate minimum payment, which is 3.35% of her total balance. How much will her balance be after she makes this payment, assuming that she pays the minimum amount? Round all dollar values to the nearest cent.

Which of these can be considered “online banking?”I. A brick-and-mortar bank that allows its customers to transfer money online.II. A bank that has only a few branches but has customers depositing money online.III. A bank that does not exist as a real building, but only has an internet presence.

Real Estate tax, a tax based on the value of the land and the buildings owned by its taxpayers, is a good example of _____.

Which answer choice does not represent an advantage to using credit cards over other forms of payment?

Kathy makes $66,000 per year, and she pays a net federal income tax rate of 18.85%. How much should Kathy expect to pay in taxes every year?

Describe the effect an increase in i, the interest rate applied to the present value, has on the monthly payment P in the formula

Sam is getting ready for a big date when he realizes that he has no money. His roommate, Bill, also has no money, but he has a credit card. Knowing that nobody will let Sam use Bill’s credit card, Sam asks Bill to pull out a cash advance for $120.00. Bill agrees under the condition that Sam is responsible for all interest that accrues on the cash advance which is a 30% interest rate, compounded monthly. The $120 cash advance is repaid in monthly installments over 5 years. How much should Bill ask Sam to pay in interest for the cash advance?