1)
noah wants to put $1,000 in a savings account with a 1.5% annual interest rate. how much more money will he have after one year if it is compounded monthly versus no compounding?
a) $0.10
b) $15.00
c) $1015.00
d) $1015.10
2)
sam has a loan for $1200 at a rate of 9% annually. how much interest will he pay in 5 years?
a) $54.40
b) $108.00
c) $540.00
d) $1740.00
3)
jill and bill are the same age. jill inherits $20,000 when she is 25, and invests it in an account earning 5% annual interest rate, compounded annually. bill receives a $20,000 bonus at age 35, and then invests it in an account which also earns a 5% annual interest rate, compounded annually. how much more money does jill have than bill at age 50?
a) $0
b) $10,000
c) $18,075
d) $26,149
4)
liam puts $2,000 in the bank with a 3% annual interest rate compounded annually. if liam does not touch his money, how much money will he have after two years?
a) $2,000.06
b) $2,060.00
c) $2,120.00
d) $2,121.80
5)
ben is choosing between two savings accounts. both accounts pay 3% interest. account x pays compound interest. account y pays simple interest. ben should choose account x because
a) the interest would be tax free.
b) it would pay interest on interest.
c) the interest rate would decrease over time.
d) the interest rate would increase over time.