Financial Literacy Review

• a 3-year loan with an 7% annual simple interest rate.

• a 4-year loan with a 5% annual simple interest rate.

• a 5-year loan with a 4.5% annual simple interest rate.

• a 6-year loan with a 3.7% annual simple interest rate.

• The balance in the account has grown only because interest was earned on the account.

• The balance in the account has grown only because regular deposits were made to the account.

• The balance in the account has grown because regular deposits were made to the account and interest was earned on the previous year's balance.

• There is not enough information to determine why the balance in the account has grown.

Draw your answer and show your work on the following question:

• Loan Option A

• Loan Option B

• Loan Option C

• Loan Option D

• First Bank of Trust: $31,500

  Valor Bank: $31,000

• First Bank of Trust: $41,200

  Valor Bank: $36,000

• First Bank of Trust: $55,500

  Valor Bank: $43,000

• First Bank of Trust: $38,566

  Valor Bank: $39,000

Simple Interest Formula is I=prt

• True
• False

Compound Interest formula is A=P(1+r)^t

• True
• False