Simple and Compound Interest

Front

Anne deposited $500 in an account that earns 6% simple annual interest. Shelly deposited $500 in an account that earns 6% annual interest compounded annually. They leave the money in the account for 4 years. What is the difference in their account balances?

Back

Shelly will have $11.24 more in her account than Anne has in her account.

Front

What is the method of computing interest on interest earned in previous years called?

Back

compound interest

Front

When calculating interest, how do you write the percent? Options: a fraction, a decimal, a round number, not enough information

Back

a decimal

Front

Equation to find the value of a $5,000 savings account with 4% interest compounded annually after 3 years.

Back

A = 5,000(1 + 0.04)³

Front

Jared invests $10,000 in a savings account that pays 3% simple interest. How many years will it take for the account to grow to $12,700, if he makes no withdrawals or deposits?

Back

9 years

Front

Karl used his credit card to buy a 90-inch HD flat-screen TV for $2,600. The credit card company charges 28% compound interest per year. If Karl made no payments for 2 years, how much would he owe the credit card company?

Back

$4,259.84

Front

In the simple interest formula I=Prt, what does the t represent?

Back

Time

Front

Find the total amount in the account to the nearest cent if the interest is compounded annually. $2750 at 8% for 2 years

Back

$440

Front

The principle in the simple interest formula I=Prt is _________________.

Back

the original amount of money borrowed or deposited

Front

Emilio borrows $1200 from a bank with 8% simple interest per year. How much will he have to pay back total in 2 years?

Back

$1392