Simple and Compound Interest Word Problems

How much interest is earned on $140 at 7% for five years?

• 20%

• $49

• $5

• 49%

How long must $217 be invested at a rate of 6% to earn $78.12 in interest?

• 6 years

• 4 years

• 8 years

• 2 years

What was the interest rate if your balance on an investment of $830 at the end of one year is $871.50?

• 5%

• 4%

• 41.5%

• 7%

The ending balance on an investment is $1,620.24. If the principal was invested at 8% for nine years, what was the principal?

• $492

• $129.62

• $942 

• $192.69

Emi will deposit $1,420 in an account that earns 4% simple interest every year for 4 years. Her sister Carys will deposit $1,400 in an account that earns 6% interest compounded annually for 4 years.  What is the difference in the amount earned between the two sisters over the 4 years?

• Emi will earn $120.27 more than Carys.

• Carys will earn $1540.27 more than Emi.

• Emi will earn $1540.27 more than Carys.

• Carys will earn $120.27 more than Emi.

If $1000 is invested at a compound interest rate of 4% per year, compounded annually, how much will the investment be worth after 2 years?

Ash has $8,000 in a savings account. The interest rate is 3% compounded once a year.

To the nearest cent, how much will he have in his account in 4 years?

• $9,004.07

• $2,2848.80

• $9,011.94

• $8,242.71

Tom invests £1200 at a rate of 7% per year. How much simple interest will he earn in 2 years?

• £84

• £168

• £240

• £336

A sum of $1500 is invested at a compound interest rate of 5% per year, compounded annually. How much will the investment be worth after 3 years?

A loan of £2000 is taken out at a simple interest rate of 3% per year. What is the interest amount after 5 years?

• £300

• £600

• £150

• £100