To users of ASMís Exam FM/2 manual:

Updated errata lists were posted over the weekend on the ASM website www.studymanuals.com. The only new item concerns question 5 at the end of Section 16 in the 6th and 7th editions (question 5 at the end of Section 7 in the 1st edition of Vol. 2).

There is another error not shown on the updated errata lists. In question 33 at the end of Section 6a, the payments due on 9/30/97 and 10/31/97 are the 69th and 70th payments, respectively. Thus, the correct equation is
v^292/v^291 = (1 - .94473)/(1 - .94418). However, this does not affect the final answer. In fact, we really donít have to determine the exponents of v in this problem. If the interest portion of the payment due on 9/30/97 is
.94473, then the principal repaid portion is 1 - .94473 = .05527. Similarly the principal repaid portion of the payment due on 10/31/97 is 1 - .94418 =
.05582. But we know that the principal repaid portions are in geometric progression, with common ratio (1 + j), where j is the monthly effective rate in this case. Thus, .05582/.05527 = 1 + j, from which we can determine j and X, where X = (1 + j)^12 Ė 1.