Compound Interest

Front

What does 'A' stand for in the compound interest formula A=P(1+r)^t?

Back

The total amount.

Front

What does 'P' represent in the compound interest formula A=P(1+r)^t?

Back

The principal amount (original amount).

Front

How do you calculate the amount of interest earned after compounding annually?

Back

Subtract P (original amount) from A (total amount).

Front

What is the formula for calculating compound interest?

Back

A = P(1 + r)^t.

Front

If you invest $1000 at an interest rate of 5% compounded annually for 3 years, what is the total amount?

Back

$1157.63.

Front

What is the interest rate in the compound interest formula A=P(1+r)^t?

Back

The rate at which interest is applied, expressed as a decimal.

Front

If you have a principal of $2000 and an interest rate of 4% compounded annually for 5 years, what is the total amount?

Back

$2433.00.

Front

What does 'r' represent in the compound interest formula A=P(1+r)^t?

Back

The interest rate per period.

Front

What does 't' represent in the compound interest formula A=P(1+r)^t?

Back

The number of time periods the money is invested or borrowed.

Front

If you want to find the total amount after 10 years with a principal of $1500 and an interest rate of 6% compounded annually, what is the total amount?

Back

$2685.06.