Quiz on Simple and Compound Interest

What is the formula for calculating simple interest?

• I = Prt

• I = r/t

• I = P(1 + rt)

• I = P + r

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

• Principal

• Payment

• Profit

• Period

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

• MV = P + (Prt)

• MV = I + P

• MV = P(1 + rt)

• MV = FV(1 + rt)

Which of the following is NOT a type of annuity?

• Simple Annuity

• Variable Annuity

• Deferred Annuity

• Ordinary Annuity

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

• The rate compounded annually

• The nominal rate

• The rate for simple interest

• The rate for deferred annuities

What does 'F' represent in the formula F = P(1 + i)^n?

• Face value

• Fund value

• Final amount

• Future value

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

• Proceeds

• Maturity value

• Principal

• Discount

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

• Deferred Annuity

• Annuity Due

• Ordinary Annuity

• Contingent Annuity

How is the present value of an annuity denoted?

• P

• R

• S

• A

What is the formula to find the time in compound interest?

• t = r/I

• t = I/Pr

• t = nm

• t = P/F