Comparing Simple and Compound Interest

Front

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

Back

Time

Front

The principle in the simple interest formula I=Prt

Back

the amount of money borrowed or deposited

Front

How to convert time in months to years for simple interest calculation? Options: divide 12 by the months, divide the months by 12, multiply 12 times the months, change the months to a decimal

Back

divide the months by 12

Front

In the formula I = Prt, rates must be converted into ____ before multiplying.

Back

decimals

Front

Holly is taking out a loan in the amount of $10,000. Her choices for the loan are a 4-year loan at 4% simple interest and a 6-year loan at 5% simple interest. What is the difference in the amount of interest Holly would have to pay for each of these two loans?

Back

$1,400

Front

Nicolas has $650 to deposit into two savings accounts: $400 into Account 1 (3.5% annual simple interest) and $250 into Account 2 (3¼% interest compounded annually). What is the total balance after 2 years? Options: $672.13, $695.00, $694.25, $694.51

Back

$694.51

Front

Interest earned on both the principal and any previously earned interest is...

Back

Compound Interest

Front

What is the interest earned on option A?

Back

$240

Front

What is the total value on option A? Options: $240, $1,040, $2,400, $3,200

Back

$1,040

Front

Steven deposits $700 at 4.8% interest compounded annually. Linda deposits $800 at 7.7% simple interest. After 7 years, which account has more and by how much?

Back

Linda by $259.29