Exponential Growth to Compound Interest

Exponential Growth to Compound Interest

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Exponential Growth/Simple Interest

Multiple Choice

What does a represent?

• Time

• Rate

• Initial Value

• Final Value

Multiple Choice

What does r represent?

• Time

• Rate

• Initial Value

• Final Value

Multiple Choice

What does t represent?

• Time

• Rate

• Initial Value

• Final Value

Fill in the Blank

Suppose you invest $3,000, at 6% annual interest, for 5 years.

What is the initial value?

Fill in the Blank

Suppose you invest $3,000, at 6% annual interest, for 5 years.

What is the rate?

Fill in the Blank

Suppose you invest $3,000, at 6% annual interest, for 5 years.

What is the time?

Fill in the Blank

Suppose you invest $3,000, at 6% annual interest, for 5 years.

Write an equation or an expression that represents this situation.

Fill in the Blank

Suppose you invest $3,000, at 6% annual interest, for 5 years.

How much money would you have after the 5 years is over?

Another Formula

Multiple Choice

If interest is compounded annually, that means how many times a year?

• Twice a year

• Four times year

• Three times a year

• Once a year

Multiple Choice

If interest is compounded QUARTERly, that means how many times a year?

• Twice a year

• Four times year

• Three times a year

• Once a year

Multiple Choice

If interest is compounded SEMI-annually, that means how many times a year?

• Twice a year

• Four times year

• Three times a year

• Once a year

Multiple Choice

If interest is compounded monthly, that means how many times a year?

• Twice a year

• Four times year

• Twelve times a year

• Once a year

Multiple Choice

Suppose you invest that same $3,000 from before. This time the 6% annually will be compounded semi-annually (twice a year), for 5 years. 

Which expression represents the situation?   $a\left(1+\frac{r}{n}\right)^{n\cdot t}$ 

•  $1000\left(1+.06\right)^5$  
  

•  $1000\left(1+\frac{.06}{2}\right)^{2\cdot5}$  
  

Multiple Choice

Choose which equation represents $1,000 invested for 6 years at 7% annually, compounded quarterly.

• $1000\left(1+\frac{.07}{12}\right)^{12\cdot6}$

• $1000\left(1+\frac{.07}{2}\right)^{2\cdot6}$

•  $1000\left(1+\frac{.07}{4}\right)^{4\cdot6}$  

•  $1000\left(1+\frac{.07}{1}\right)^{1\cdot6}$  

Multiple Choice

Choose which equation represents $1,000 invested for 6 years at 7% compounded annually.

• $1000\left(1+\frac{.07}{12}\right)^{12\cdot6}$

• $1000\left(1+\frac{.07}{2}\right)^{2\cdot6}$

•  $1000\left(1+\frac{.07}{4}\right)^{4\cdot6}$  

•  $1000\left(1+\frac{.07}{1}\right)^{1\cdot6}$  

Multiple Choice

Choose which equation represents $1,000 invested for 6 years at 7% compounded semi-annually.

• $1000\left(1+\frac{.07}{12}\right)^{12\cdot6}$

• $1000\left(1+\frac{.07}{2}\right)^{2\cdot6}$

•  $1000\left(1+\frac{.07}{4}\right)^{4\cdot6}$  

•  $1000\left(1+\frac{.07}{1}\right)^{1\cdot6}$  

Multiple Choice

Choose which equation represents $1,000 invested for 6 years at 7% annual interest, compounded monthly.

• $1000\left(1+\frac{.07}{12}\right)^{12\cdot6}$

• $1000\left(1+\frac{.07}{2}\right)^{2\cdot6}$

•  $1000\left(1+\frac{.07}{4}\right)^{4\cdot6}$  

•  $1000\left(1+\frac{.07}{1}\right)^{1\cdot6}$