Compound Interest and Exponential Functions

Semi-Annually means how many times a year?

• 4

• 2

• 1

• 6

Monthly means how many times a year?

• 4

• 12

• 52

• 365

Karla invested $1,000 in savings bonds. If the bonds earn 6.75% interest compounded semi-annually, how much total will Karla earn in 15 years?

• $1,584.62

• $2,651.39

• $2,706.86

• $1,825.10

Emily would like to buy some new furniture for her home. She decides to buy the furniture on credit with 9.5% interest compounded quarterly.

If she spent $7,400, how much total will she have paid after 8 years.

• $15,415.94

• $15,683.28

• $15,927.56

• $16,109.05

Jay'den earned $475 from mowing lawns last summer. He deposited this money in an account that pays an interest rate of 3.8% compounded annually.

What will be his balance after 15 year?

• $827.52

• $831.10

• $839.45

• $846.80

Change 6.75% to a decimal.

• 67.5
• .675
• 675
• .0675

Which of the following exponential equations is the formula for compound interest?

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Karla invested $1,000 in savings bonds. If the bonds earn 6.75% interest compounded semi-annually.

Which exponential equation can be used to find how much money Karla will earn in 15 years?

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• 
• 
• 

Emily would like to buy some new furniture for her home. She decides to buy the furniture on credit with 9.5% interest compounded quarterly.

If she spent $7,400, what exponential equation can be used to find how much she will pay after 8 years.

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• 
• 

Jay'den earned $475 from mowing lawns last summer. He deposited this money in an account that pays an interest rate of 3.8% compounded annually. Jay'den wants to know his balance after 15 years?

What does $475 represent?

• Principal or initial value, P

• Rate of interest, r

• Number of times interest is compounded, n

• Time, t