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Dec. 17 Compound Interest

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RyanWatt

Sam invests $5000 at an interest rate of 5% compounded annually. Using the compound interest formula, the summary calculates how much Sam's investment will be worth after 5 years. The document also provides an example of Byron borrowing $10,000 from Erick at an interest rate of 3.5% compounded annually, and calculates how much Byron will pay back after 2 months using the same formula. It includes the compound interest formula and defines the terms used.

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Compound Interest
Sam has $5000 to invest. She has found a place where she can earn 5%, compounded annually. How much is her investment worth after 5 years?
Dec. 17 Compound Interest
n*t Compound Interest formula : A = P ( 1+ n r ) - A is the amount you have at the end of your investment - P is the amount you invest - r is the rate as a decimal - t is the time in years - n is the number of times interest is compounded in a year
Byron has borrowed $10000 from Erick. Erick is charging him an interest rate of 3.5%, compounded annually. If Byron pays Erick back after 2 months, how much will he pay?
Exercise 43 Questions 1 - 5 7 - 11

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Dec. 17 Compound Interest

  • 2. Sam has $5000 to invest. She has found a place where she can earn 5%, compounded annually. How much is her investment worth after 5 years?
  • 4. n*t Compound Interest formula : A = P ( 1+ n r ) - A is the amount you have at the end of your investment - P is the amount you invest - r is the rate as a decimal - t is the time in years - n is the number of times interest is compounded in a year
  • 5. Byron has borrowed $10000 from Erick. Erick is charging him an interest rate of 3.5%, compounded annually. If Byron pays Erick back after 2 months, how much will he pay?