Investing Answers

An initial amount of $800 is invested in a compound savings account with an annual interest rate of 4.5%. Using the formula , what is the balance after five years?

Uta invests an amount into a compound interest investment account that pays 6% a year. After six years, she withdraws her total balance of $500. Using the formula , how much money did Uta initially invest?

George’s parents are saving for his college fund. They put $5,000 into an interest bearing account with a compound interest rate of 5.5%. George’s parents want to determine what the balance of his college fund account will be after 15 years. Using the formula , which is the correct substitution for the formula?

Which equation demonstrates the use of a simple interest formula, , to compute the interest earned on $70 at 3% for 12 years?

Ted and Alan are in a race to double their money. Ted feels he will win if he puts his $4,000 into a savings account offering 4.5% interest compounded annually. Alan feels he will win because he intends to put his $1,000 into a savings account offering 6% interest compounded annually. Using the rule of 72, , who will win, and how many years will it take to double his money?

Three friends decide that they each want to be able to buy a new boat in five years. Vanore puts $1,000 in a savings account with a simple interest rate of 4.5%. Keir invests $1,200 in a standard savers account with a simple interest rate of 4%.Omar invests $950 in a junior achievers account with a 6% annual compound interest rate.Who will have the most money to spend on a new boat at the end of the five years? Use the formula for simple interest and for compound interest. Round to the nearest dollar.

Sylvia invested $500 in an account compounded annually with an interest rate of 8%. Manuel invested $600 in an account with a compound interest rate of 7.25%. Using the rule of 72, , who will double their money first?

Herky and Elaina want to compare their investment accounts to see how much they will have in the accounts after eight years. They substitute their values shown below into the compound interest formula.Compound Interest AccountsNamePrincipalInterest RateNumber of YearsCompoundedHerky$5005%8Once a yearElaina$4006%8Once a yearWhich pair of equations would correctly calculate their compound interests?

Which descriptions about simple interest and yearly compounded interest are true? Select four options.

Jaina and Tomas compare their compound interest accounts to see how much they will have in the accounts after three years. They substitute their values shown below into the compound interest formula.Compound Interest AccountsNamePrincipalInterest RateNumber of YearsCompoundedJaina$3007%3Once a yearTomas$4004%3Once a yearWhich pair of equations would correctly calculate their compound interests?

Uta invests $345 into a simple interest investment account that pays interest at a rate of 9% a year. After several years, she withdraws her balance of $531.30. Using the formula , how many years was her money invested?

To save for a car when he turns 18, Pascale deposited $500 each year into a savings account with a 7.5% interest rate compounded annually.YearBeginning BalanceInterest EarnedEnding Balance1$500.00$37.50$537.502$1,037.50$77.81$1,115.313$1,615.31$121.15$1,736.464$2,236.46$167.73$2,404.195 Using the formula , what is the value of the account at the end of the fifth year?

Jala put $600 in an interest bearing account with a annual compound interest rate of 5%. Jala determined that after seven years, she will have a total balance of $844.26. Using the rule of 72, how many more years will it be before Jala’s $600 doubles in value? Round to the nearest tenth.

Sally’s parents deposited $15,000 into a college savings account on her third birthday. The account had an interest rate of 9.6% compounded annually. They were hoping that the money would double twice by the time she was 18 years old. Using the rule of 72, will their hopes come true?

Veronique and Lily compare their investment accounts to see how much they will have in the accounts after seven years. They substitute their values shown below into the compound interest formula.Compound Interest AccountsNamePrincipalInterest RateNumber of YearsCompoundedVeronique$1,0005%7Once a yearLily$1,8009%7Once a yearWhich pair of equations would correctly calculate their compound interests?

Using the rule of 72, , how long will it take for the principal to double with an annual compound interest rate of 6%?

Sharla invests $275 in a simple interest bearing account for 16 years. The annual interest rate is 8%. Using the simple interest formula, , how much interest will Sharla’s initial investment earn over the 16 year period?

Anastasia was trying to decide which investment plan would be best over 10 years. Bank A was offering 8.5% simple interest on her money using the formula . Bank B was offering 8% compounded annually using the formula . Which bank is a better investment if she has $2,000 to invest for 10 years?