Finance Midterm EXAM

Front

In the compound interest formula, what does 'n' represent?

Back

The number of times interest is compounded per year.

Front

Back

45%.

Front

If Julian Hathaway earns $32,000 annually and receives biweekly paychecks, how much is each paycheck?

Back

$1,230.77.

Front

What percent of the points did Jeremy get correct if he missed 19 out of 100 points?

Back

81%.

Front

How much simple interest does Frank earn after depositing $350 at an annual interest rate of 4% for 3 years?

Back

$42.

Front

What is the formula for calculating simple interest?

Back

Simple Interest = Principal × Rate × Time.

Front

Define 'principal' in finance.

Back

The initial amount of money deposited or invested.

Front

What is the difference between simple interest and compound interest?

Back

Simple interest is calculated only on the principal, while compound interest is calculated on the principal plus any accumulated interest.

Front

How do you calculate the annual interest rate from a total interest earned?

Back

Annual Interest Rate = (Total Interest / Principal) / Time.

Front

What does it mean to express a fraction as a percent?

Back

To convert a fraction into a value out of 100.