Financial Literacy Practice

Holly is taking out a loan in the amount of $10,000.  Her choices for the loan are a 4-year loan at 4% simple interest and a 6-year loan at 5% simple interest.  What is the difference in the amount of interest Holly would have to pay for each of these two loans?

• $1,600
• $3,000
• $4600
• $1,400

Tags

CCSS.7.RP.A.3

Olivia will deposit $1,530 in an account that earns 6% simple interest every year.  Her sister Melinda will deposit $1,500 in an account that earns 8% interest compounded annually.  The deposits will be made on the same day, and no additional money will be deposited or withdrawn from the accounts.  Which statement about the balances of Olivia's account and Melinda's account at the end of 3 years is true?

• Olivia's account will have about $5.40 more than Melinda's account.
• Olivia's account will have about $84.17 more than Melinda's account.
• Melinda's account will have about $5.40 more than Olivia's account.
• Melinda's account will have about $84.17 more than Olivia's account.

Isabella deposited $2,000 in an account that pays 5% simple annual interest.  After one year how much interest will her investment pay? 

• $2,100
• $100
• $10,000
• $400

Tags

CCSS.7.RP.A.3

Tamara invested $15,000 in an account that pays 4% annual simple interest.  Tamara will not make any additional deposits or withdrawals.  How much interest will Tamara earn on her investment at the end of 3 years?

• $1,800
• $600
• $450
• $1,873

Tags

CCSS.7.RP.A.3

Mr. Wilkins deposited $2,500 in a new account at his bank.
       *The bank pays 6.5% interest compounded annually on this account.
       *Mr. Wilkins makes no additional deposits or withdrawals.
Which amount is closest to the balance of the account at the end of 2 years?

• $2,835.56
• $2,513.00
• $2,662.50
• $2,825.00

Tags

CCSS.HSF-LE.A.1C

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.

Steve deposited

$5,000 in a savings account that pays 4% 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

The compound interest formula is:

A = P(1 + r)^t

What does the A represent?

• The amount of interest earned.

• The amount of time that has passed.

• The total amount of money after a certain amount of time.

• The amount required to invest.

Tags

CCSS.HSF-IF.C.8B

the time has to be in _____________

• years

• months

• days

• seconds

Tags

CCSS.4.MD.A.1

Ricco deposits $500 in an account that earns 2.5% interest compounded annually for 3 years.  Wally deposits $500 in an account that earns 5.1% interest compounded annually for 2 years.  Who will earn the greatest amount of interest?

• Ricco will earn $13.85 more than Wally
• Wally will earn $13.85 more than Ricco