PF 2.2 Quiz

The rule for doubling your money is called the Rule of...

Which of these is the correct formula for estimating the doubling of your money?

• Rate * Years = 84

• Rate * Years = 72

• Principal * Rate = 72

• Principal * Rate = 84

If you invested money, it would grow faster if your interest was...

• simple interest

• compound interest

• zero interest

Simple Interest

• Interest on Principal

• Interest on Interest

• Interest on Time

• A = P+1(r)^t

Compound Interest

• Interest on Principal

• Interest on Interest

• Interest on Time

• A = P+1(r)^t

This graph shows...

• Simple Interest

• Compound Interest

• The Principal-Time Theory

• The Principle of Creative Destruction

This graph shows...

• Simple Interest

• Compound Interest

• The Principal-Time Theory

• The Principle of Creative Destruction

What is Amortization?

• the process of gradually paying off a debt over time

• a rise in prices, which can be translated as the decline of purchasing power over time.

• a reduction of the general level of prices in an economy

• the process of borrowing money from a lender given the number of assets you have

How long will it take your money to double if you save $1,000 at a 9% interest rate?

• 8 years

• 7 years

• 6 years

• 5 years

How long will it take your money to double if you save $1,000 at a 12% interest rate?

• 8 years

• 7 years

• 6 years

• 5 years