Unit 5 Exponentials Flashcard

Front

What is the formula to convert a monthly interest rate to a yearly interest rate?

Back

Yearly Interest Rate = (1 + Monthly Interest Rate)^12 - 1

Front

If a bank offers a monthly interest rate of 1.2%, what is the approximate yearly interest rate?

Back

About 15.3%.

Front

How do you convert a yearly interest rate to a monthly interest rate?

Back

Monthly Interest Rate = (1 + Yearly Interest Rate)^(1/12) - 1

Front

If Mike has a yearly interest gain of 20%, what is his monthly interest rate?

Back

About 1.5%.

Front

What is the definition of logarithm in terms of exponentials?

Back

Front

Back

Front

What is compound interest?

Back

Interest calculated on the initial principal and also on the accumulated interest from previous periods.

Front

What is the formula for compound interest?

Back

A = P(1 + r/n)^(nt), where A is the amount, P is the principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the number of years.

Front

If f(x) = 5000(1 + .03)^(4x), what is the actual rate of interest?

Back

12%.

Front

What is the formula to calculate the total amount earned from an investment with compound interest?

Back

Total Amount = Principal * (1 + r/n)^(nt).