Compound Interest and Depreciation

Steve deposited $5,000 in a savings account that pays 4%p.a interest compounded annually.

Which equation could be used to find the value of the account after 3 years?

• A = 5,000(1 + 4)³

• A = 5,000(1 + 0.04)³

• A = 5,000(1 + 0.4) x 3

• A = 5,000(0.04)³

You borrowed $59,000 for 2 years at 11% p.a which was compounded annually. What is the total?

• $13,693.90

• $1,363.90

• $72,693.90

• $73,793.90

Change 18% to a decimal

• 180

• 0.18

• .018

• .18%

Change 6.5% to a decimal

• .65

• 6.5

• .065

• .065%

In the compound interest formula A=P(1+r)^t what does the A stand for?

• The amount of interest

• The total amount

• The interest rate

• The time

The number of mosquitoes at the beginning of the summer was 4,000. The population of mosquitoes is expected to grow at a rate of 25% a month. How many mosquitoes will there be after 4 months?

• 9766
• 9006
• 9765
• 5433

A population of fish starts at 8,000 and decreases by 6% per year. What is the population of fish after 10 years?

• 14327
• 4309
• 839
• 7680

Suppose a culture of bacteria begins with 5000 cells and dies by 30% each year. Write an equation that represents this situation.

• y=5000(0.7)^x
• y=30(5000)^x
• y=5000(1.3)^x
• y=5000x^x

Your shiny new boat cost $7650.  The depreciation for your boat is 14% per year. Estimate the value of your vehicle in 3 years. What is the equation that models this problem?

• y= 7650(.14)³
• y= 7650(.86)³
• y= 7650(1+.86/1)^3*1

Daniel’s Print Shop purchased a new printer for $35,000. Each year it depreciates at a rate of 5% p.a. How much will the printer be worth in 8 years?

• $23,219.72

• $136.72

• $51,710.94

• $16,710.94