AFA-Final Exam 2025

Which formula represents simple interest?

What is the standard formula for compound interest when interest is compounded monthly?

A principal of $500 is invested at a simple interest rate of 4% per year for 3 years. What is the interest earned?

• $60

• $40

• $50

• $30

If $1,000 is invested at an annual compound interest rate of 5% for 2 years, what is the total amount at the end of 2 years? (Round to the nearest dollar)

• $1,100

• $1,103

• $1,053

• $1,200

Which of the following is NOT required to calculate simple interest?

• Principal

• Time

• Interest rate

• Number of compounding periods

A loan of $2,400 is to be repaid in 12 monthly installments at a monthly interest rate of 1%. Which formula would you use to find the monthly payment?

Calculate the percent change if a value decreases from 200 to 150.

• -25%

• -20%

• 25%

• 20%

A principal of $1,200 is invested at a simple interest rate of 3% per year for 5 years. What is the total amount at the end of 5 years?

• $1,380

• $1,200

• $1,800

• $1,500