Quiz on Business Math (Simple and Compound Interest

What is the formula for calculating simple interest?

• I = Prt

• I = P(1 + rt)

• I = P + r

• I = r/t

In the context of simple interest, what does 'P' stand for?

• Period

• Profit

• Payment

• Principal

What is the maturity value formula for a simple interest note?

• MV = P(1 + rt)

• MV = I + P

• MV = FV(1 + rt)

• MV = P + (Prt)

Tags

CCSS.7.RP.A.3

Which of the following is NOT a type of annuity?

• Ordinary Annuity

• Deferred Annuity

• Contingent Annuity

• Simple Annuity Due

Tags

CCSS.HSF-LE.A.1C

What is the effective rate 'w' in compound interest?

• The rate for simple interest

• The rate for deferred annuities

• The nominal rate

• The rate compounded annually

How is the present value of an annuity calculated?

• A = R(1 - (1 + i)^-n)

• A = R(1 + i)^n

• A = S(1 + i)^n

• A = S(1 + i)^-n

What does 'F' represent in the formula F = P(1 + rt)?

• Final amount

• Fund value

• Future value

• Face value

Tags

CCSS.8.EE.C.7B

In a bank discount note, what is the sum of money actually received called?

• Interest

• Proceeds

• Maturity value

• Principal

Tags

CCSS.7.RP.A.3

What is the term for an annuity with no fixed terms?

• Contingent Annuity

• Ordinary Annuity

• Annuity Due

• Deferred Annuity

Tags

CCSS.HSF-LE.A.1C

Which formula is used to find the nominal rate 'r' in compound interest?

• r = F/Pt

• r = I/Pt

• r = P(1 + i)^n

• r = im