I'm sorry, but there's only one step and thus one equation for every problem. In each problem, I explained and wrote out which formula is to be used, then substitued all the numbers that go into the equation, and then calculated the answer. I'm not sure what more you are looking for.

Perhaps if you have specific questions about any of the problems, you can ask them and I can try to answer.

Edited by Steve_Song on 8/5/2009 at 6:15 PM

What I'm saying is that there aren't multiple steps to these questions. To solve every one of these questions, it involves one basic formula, which is in and of itself the definition of what it's describing. For instance, simple interest is defined by principal x interest rate x time. That's the basic formula that describes simple interest and you just plug in the numbers given in the problem. There are no steps involved other than 1-identify the basic equation and 2-plug in the numbers. I added more explanation and description of what the basic formulas are in the lines below. I hope this helps. If you still need more explanation, then you just need to sit down and read the text book or other reference and read about the concepts. The questions you posted aren't asking you to explain the concepts.

1
<< this is the definition for simple interest: money deposited times the interest rate times the time. Money deposited is 2500, interest rate is 11%, and the time is 3. 2500*11%*3 = 825
<< if you want more explanation on what simple interest is, then read the text book or go to http://en.wikipedia.org/wiki/Simple_interest#Simple_interest

2
<< this is the definition for compound interest: money dposited times (1+interest rate per period)^number of periods - money deposited. Just substitute the numbers in.
<< if you don't know what compound interest is, then I suggest you read the text book or go to: http://en.wikipedia.org/wiki/Compound_interest

3
<< an annuity means a set amount of money being invested each year, while interest accrues on the total invested amount. The formula for determining what the total accumulated amount is defined for you above. Short of going through a math derivation, this is the defintion of what an annuity is.
<<In this example, 23000 is deposited each year for three years, while interest builds on the the invested money at 10% per year. Plug in the numbers into the formula above and you have the answer. There is no other step that determining what the basic formula is, then plugging in the numbers.
<< If you still have no idea what an annuity is, then I suggest you go read the text book or go to: http://en.wikipedia.org/wiki/Annuity_(finance_theory)

4
<< what is tax? It's a certain percentage that the government takes based on some value. The value is the assessed value of 109400. The tax percentage is 35.4 mills. What's a mill? A mill is 1/1000. so 35.4 mills is 35.4/1000 = 3.54%. So the tax due is the value assessed value multiplied by the tax rate.
<< If you still have no idea on how to get property tax based on the assessed value and property tax rate, I suggest you go read the text book or go to: http://en.wikipedia.org/wiki/Property_tax

5
<< Do you know how to get the present value of a set of cash flows? If so, this is nothing more than that. Imagine you buy 1 stock and hold it forever. What is the cash that comes in? It's the dividend payments that come in every year.
<< $1.28 comes in every year forever. How do you get the value of this? It's called a perpetuity (the same amount of money coming in every year). What's the basic formula for a perpetuity? It's PV = C/r, where C is the dividend and r is the rate of return. The rate of return is the same thing as yield in this problem.
<< r is what you're looking for, so rearrange the equation and solve for r. r = C/PV. PV is the price of the stock. Plug in the numbers and you have the answer.
<< If you have no idea on how to use a perpetuity formula, I suggest you go read the text book or go to:http://en.wikipedia.org/wiki/Perpetuity and http://en.wikipedia.org/wiki/Dividend_valuation_model

6
<< all tax rates given are annual tax rates, which is the amount due for the year. The total tax rate is the sum of the three tax rates. This total is charged against the annual income of 56000. Since this is an annual tax amount, divide it by 4 to get the quarterly tax amount. The algebra has been worked out in the spreadsheet.