Practice: Simple and Compound Interest

Front

In the formula I = Prt, rates must be converted into ____ before multiplying.

Back

decimals

Front

In the compound interest formula A=P(1+r)^t, what does the A stand for?

Back

The total amount

Front

In the compound interest formula A=P(1+r)^t, what does the P stand for?

Back

The principal amount (original amount)

Front

How can you find the time in years if given the time in months for calculating simple interest?

Back

Divide the months by 12.

Front

What is the formula for simple interest?

Back

I=Prt

Front

How is time calculated in I = Prt?

Back

It must be in years.

Front

A bank is offering 3% simple interest on a savings account. If you deposit $5,000, how much interest will you earn in 3 years?

Back

$450

Front

A bank is offering 7% annual compound interest on a savings account. If you deposit $1,500, what will be the total amount of money in your savings account after 1 year?

Back

$1,605

Front

Caiden earned $475 from mowing lawns last summer. He deposited this money in an account that pays an interest rate of 3.8% compounded annually. What will be his balance after 15 years?

Back

$831.10

Front

Starting money = $350. Interest rate = 2.5% Time = 3 years. How much interest using simple interest formula?

Back

$26.25