Personal Financial Literacy

Landry earned $2,300 over the summer and decided to invest in an account that earns 4% annual compound interest. If Landry does not make any other deposits or withdrawals, how much will be in her account after 20 years?

• $2,739.58

• $5,039.58

• $1,840

• $4,140

Naomi gets a $26,000 loan in order to purchase a new car. Her loan has an interest rate of 3.5% and she has decided she will pay off the car in 5 years with monthly payments of $473. If Naomi makes her monthly payments for the next 5 years, what is the total amount that she will spend to pay off the loan?

• $28,380

• $26,000

• $455,000

• $31,270

Aaron created the table to help him estimate the total cost of his first year at a public university.

Aaron's grandfather gave him a $12,000 gift to use towards his college expenses, and Aaron received a $1,500 academic scholarship. Including his gift and scholarship, what should Aaron estimate the total cost of his first year to be?

• $5,392.50

• $35,070

• $21,570

• $8,070

Two brothers, Marvin and Luis, each invest $5,000 into accounts that earn 5% interest. Neither brother deposits or withdraws anything from the account for 25 years. If Marvin's account earns compound interest and Luis's account earns simple interest, who will earn more interest after 25 years, and by how much?

• Luis will earn $11,250 more in interest than Marvin.

• Marvin will earn $16,931.77 more in interest than Luis.

• Marvin will earn $10,681.77 more in interest than Luis.

• Marvin will earn $5,681.77 more in interest than Luis.

Deena wants to buy a $2,200 laptop, but she doesn't have the money. She decides to finance the purchase and will pay monthly payments of $231.55 for a year. How much extra will Deena end up paying for the laptop because she financed it rather than paying for it all at once?

• $2,778.60

• $1,621.40

• $578.60

• $463.10

Chris is going to be a junior in high school, and the college he wants to go to costs $9,264 for tuition the first year. Chris's parents have a savings account that will cover 75% of his first year's tuition, and the rest Chris will need to pay for. If he has two years to save the money, how much should Chris save each month in order to meet his goal?

• $96.50

• $2,316

• $193

• $289.50

Kevin financed a $2,800 vacation on his credit card. The table shows different monthly payments that Kevin is considering making, including how many months it would take him to pay off the card and total amount he will pay in interest.

Which is a correct conclusion from the table?

• The more he chooses to pay off each month, the higher total interest he will pay.

• The quicker he pays off the credit card, the more interest he will pay.

• The more he chooses to pay off each month, the less total interest he will pay.

• The amount he chooses to pay each month will not affect the total interest he pays.

Vance invests $15,000 in an account that pays 3.25% simple interest for 72 months. Assuming Vance doesn’tmake any other deposits or withdrawals, how much will be in his account after 72 months?

• $2,925

• $17,925

• $35,100

• $29,250

Richard wants to start a college savings account for

his daughter. Which would be helpful advice to give

Richard in order to help him maximize his savings

amount?

• Invest for only a short amount of time

• Choose a savings account with a small interest rate

• Regularly withdraw money from the savings

  account

• Choose a savings account with compound interest

  rather than simple interest

When Lisa and Tom had their first child, they put

$7,500 into a savings account that earns 6%

compound interest. If Lisa and Tom did not add or

remove anything from the savings account, how

much interest will they have earned after 4 years?

• $180,000

• $1,968.58

• $1,800

• $9,468.58