Annual Compound Interest Assignment

Jot down the formulas shown in the image. You will need them for all questions. You may use a calculator on this assignment (you're welcome).

• Okay.

• Got it.

Gabriel deposits $2,500 into each of two savings accounts. Account I earns 4% annual simple interest. Account II earns 4% interest compounded annually. Gabriel does not make any additional deposits or withdrawals. What is the sum of the balances of Account I and Account II at the end of 3 years?

• $5,600.00

• $5,612.16

• $5,624.32

• $5,200.00

Nicolas has $650 to deposit into two different savings account. Nicolas will deposit $400 into Account I, which earns 3.5 % annual simple interest. He will deposit $250 into Account II, which earns 3 1/4% interest compounded annually. Nicolas will not make any additional deposits or withdrawals. Which amount is the closest to the total balance of these two accounts at the end of 2 years?

• $672.13

• $695.00

• $694.25

• $694.51

Caiden deposited $475 in an account that pays an interest rate of 3.8% compounded annually. What will be his balance after 15 years?

• $827.52

• $831.10

• $839.45

• $846.80

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

What does P represent in the equation A=P(1+r)^t

• rate

• principal

• time

• amount

What does r represent in the equation A=P(1+r)^t

• rate

• principal

• time

• amount

You borrowed $59,000 for 2 years at 11% which was compounded annually. What is the total?

• $13,693.90

• $1,363.90

• $72,693.90

• $73,793.90

Audrey deposited $2,800 in a

savings account that pays 2.65% interest compounded annually.

What is the total value of the account after 7 years?

• $562.57

• $3362.57

• $14,514.15

• $2,569,680

Your 3 year investment of $20,000 received 5.2% interest compounded annually.  What is your total return?

• $23,285.05

• $3,285.05

• $2,385

• $32,285