Quiz: Simple and Compound Interest

A bank is offering 2.5% simple interest on a savings account. If you deposit $5,000, how much interest will you earn in three years?

• $5375

• $375

• $37500

• $42500

Sarah borrowed $18,000 for 4 years at an annual simple interest rate of 7%. What is the total amount she will repay for the car loan?

• $504000

• $5040

• $23040

• $18000

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. Which

statement is true about the two investments after 4 years?

• Shelly will have $131.24 more in her account

  than Anne has in her account.

• They will have the same

  amount in their accounts.

• Shelly will have $11.24 more

  in her account than Anne has in her account.

• Anne will have $11.24 more in

  her account than Shelly has in her account.

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Sharyce put some money in a savings account that paid 2.7% simple interest. After a year, the account was worth $7,890.44. What was the amount Sharyce originally deposited?

• $7,200

• $7,683

• $7,500

• $7,700

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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?

• $5,069.84

• $4,772.18

• $4,259.84

• $4,056.00

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You deposit $2,500 in a savings account.

What is the difference in the amount of interest that will be paid in each situation?

Option A) Interest rate of 8.25% simple interest for 2 years

Option B) Interest rate of 6.5% compounded annually for 2 years

• $769.40

• $335.56

• $76.94

• $68.52

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Riley invested $1,000 in savings bonds. If the bonds earn 6.75% interest compounded semi-annually, how much total will Riley earn in 15 years?

• $1,584.62
• $2,651.39
• $2,706.86
• $1,825.10

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Olivia would like to buy some new furniture for her home. She decides to buy the furniture on credit with 9.5% interest compounded quarterly. If she spent $7,400, how much total will she have paid after 8 years.

• $15,415.94
• $15,683.28
• $15,927.56
• $16,109.05

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Courtney saved up $2,200 working as a waitress over the summer. She put this money into a bank account that earned 5.2% interest and is compounded daily. How much will she have in her account at the end of 4 years?

• $2201.25
• $2694.55
• $2707.45
• $2708.63

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You want to save $5,000 for future family vacation. If you assume you can get an interest rate of 4.3% compounded monthly, then how much will you need to invest NOW to reach your vacation goal in 3 years?

• $307,042,791

• $5,000

• $3,250

• $4,395.89

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