Compound Interest

Jacob borrows $500 from Abraham and agrees to have the loan compounded annually for 5 years with an interest rate of 2.5%. How much will the total amount be that Jacob owes?

• n

• Final Amount

• A

• 5 years

• t

• $500

• P

• Annually

• r

• 2.5%

Jacob borrows $500 from Abraham and agrees to have the loan compounded annually for 5 years with an interest rate of 2.5%. How much will the total amount be that Jacob owes?

• $565.70

• $262609.38

• $65.70

• $630.20

Principal: $5000
Interest Rate: 3.75%
Time: 25 years
Compounded Monthly
State the future account balance.

• $12712.31
• $12,749.30
• $12,657.59
• $12550.84

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

What does the P stand for in this formula?

• Initial amount

• Final amount

• Rate

• Time

• The number of times compounded per year

What does the n stand for in this formula?

• Initial amount

• Final amount

• Rate

• Time

• The number of times compounded per year

Quarterly means how many times a year?

• 4

• 2

• 1

• 6

Monthly means how many times a year?

• 4

• 12

• 52

• 365

Mark took a loan out for $25,690 to purchase a truck. At an interest rate of 5.2% compounded monthly, how much total will he have paid after 5 years?

• $33,299.42       playing dodgeball
• $33,672.68   climbing trees
• $34,157.04         riding unicycles
• $34,710.88      flipping pancakes

Gary deposited $500 in an accoutn that earns 3% interest compounded annually. How much interest will the account earn after 6 years? 

• $90.00
• $100.00
• $97.03
• $109.20