AMDM: compound interest formula

What does the n stand for in this formula?

• Initial amount

• Final amount

• Rate

• Time

• The number of times compounded per year

What does the r stand for in this formula?

• Initial amount

• Final amount

• Rate

• Time

• The number of times compounded per year

Change 6.5% to a decimal

• .65

• 6.5

• .065

• .065%

Quarterly means how many times a year?

• 4

• 2

• 1

• 6

Annually means how many times a year?

• 4

• 2

• 1

• 6

Semi-Annually means how many times a year?

• 4

• 2

• 1

• 6

Monthly means how many times a year?

• 4

• 12

• 52

• 365

Steve deposited $5,000 in a savings account that pays 4% interest compounded annually.

Which equation could be used to find the value of the account after 3 years?

• A = 5,000(1 + 4)³

• A = 5,000(1 + 0.04)³

• A = 5,000(1 + 0.4) x 3

• A = 5,000(0.04)³

The Arnold's took out a loan for a home. The amount was $195,000 at a 4% interest rate compounded annually, how much will they have paid after 30 years?

• $412,489.75

• $529,586.31

• $632,462.51

• $640,891.12

Karla invested $1,000 in savings bonds. If the bonds earn 6.75% interest compounded semi-annually.

Which exponential equation can be used to find how much money Karla will earn in 15 years?

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