Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest...

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Simple Interest and Compound Interest

Transcript of Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest...

Page 1: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

Simple Interestand

Compound Interest

Page 2: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

Formulas

A P(1 rt )

I Prt

Simple Interest Future Value Formula

Interest Earned

Page 3: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

Find the future value of $3670 deposited at 2¾% annual simple interest for 7 years.

Page 4: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

How much must be deposited now at

annual simple interest so that in 2 years and 7 months an account will contain $3000?

%87

5

Page 5: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

Formulas

A P 1 r

m

mt

Compound Interest Future Value Formula

Page 6: Simple Interest and Compound Interest. Formulas Simple Interest Future Value Formula Interest Earned.

When Mike Jones was born, his grandparents deposited $5,000 into a special account for Mike’s college education. The account earned 7¼ % interest compounded daily.

How much will be in the account when Mike is eighteen?