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GW#1 Compound Interest

Total questions: 10

Worksheet time: 5mins

Name
Class
Date
1.

It refers to the result of reinvesting interest, rather than paying it out, so that interest in the next period is then earned on the principal sum plus previously accumulated interest.

a)

simple interest

b)

principal

c)

compounding period

d)

compound interest

2.

__________ is the amount of money one borrows.

a)

interest

b)

principal

c)

rate

d)

future value

3.

If your invested money will earn interest every 6 months, then it follows that its compounding period is ______.

a)

1

b)

2

c)

4

d)

12

4.

JK invested his money money in a bank that offers 6% compounded monthly for 3 years. What is the total number of compounding periods?

a)

1

b)

2

c)

4

d)

12

5.

if P= $7620, t= 3, r=5%, n=2, how much is amount of the future value?

a)

$7620

b)

$8836.36

c)

$10211.53

d)

$8821.10

6.

If P= 1500, t= 18 months, r=7% compounded semi-annually, how much is compound interest?

a)

1660.22

b)

660.22

c)

1663.08

d)

663.08

7.

Jimin borrowed $18000 and agreed to pay the principal with interest at 9% compounded quarterly. Find the amount she needs to pay after 6 years.

a)

$18000

b)

$30187.80

c)

$30703.80

d)

$12703.80

8.

Vante invested $10000 at 5% compounded monthly. How much money will he have after 25 years?

a)

$33863.55

b)

$34812.90

c)

$23863.55

d)

$24812.90

9.

When Jin was born, his parents invested $2300 at 6% compounded quarterly. Find the value of the invested money on Jin's 18th birthday.

a)

$6564.98

b)

$6718.66

c)

$4264.98

d)

$4418.66

10.

RM borrowed $1500 and promised to pay after 6 months with 12% interest. How much should he pay his lender?

a)

$1587.45

b)

$1590

c)

$587.45

d)

$1684.75