Simple Interest
What is $6,000 at 5% for 3 years?
What is $6,900?
Because (6,000 x 0.05 x 3 = 900)
What is $1,140 at 5% compounded annually for 2 years?
What is $1,256.85?
Because 1,140(1+0.05/100)^1 x 2 = 1,256.85
Find the amount of savings if $2,000 is deposited for three years at 5% annual interest, compounded annually.
What is $2,315.25?
Because 2000(1+ 0.05)^3
In the TVM calculator, this letter represents a number of periods/years.
What is N?
This is the process where the value of an investment grows exponentially.
What is Compounding?
What is $300 at 8% for 7 years
What is $468?
Because 300+(300 x 0.08 x 7) = 300 +168 = $468
What is $1,050 at 3% compounded monthly for 3 years?
What is $1,148.75?
Because 1050(1+ 0.03/12) ^ 12 x 3
At the end of one year, what would be the total savings be on a principal of $500 at 4% annual interest, compounded annually?
What is $520.00?
Because 500 (1 + 0.04/1)^1 x 1 = 520.00
When you deposit money into an account, the Present Value (PV) should be this number.
What is a negative number?
Type of interest is only calculated with the principal amount, never with interest that is earned.
What is Simple Interest?
What is $5,000 at 4% for 4 years?
What is $5,800?
Because 5,000 + (5000 x 0.04 x 4) = 5,800
What is $67,000 at 6.7% compounded twice a year for 5 years?
What is $93,149.30?
Because 6700(1+0.067/2)^2x5
Find the amount of savings if $2,000 is deposited for one year at 5% annual interest, compounded every six months.
What is $2,101.25?
Because 2000 (1 + 0.05/2) 2 x 1 = 2,101.25
In the TVM calculator, this represents the equal payments that is made into an account every period.
What is PMT?
This is when prices tend to rise, the average percentage increases the prices over time.
What is Inflation Rate?
What is $20,500 at 9% for 3 years?
What is $26,035?
Because 20,500 + (20,500 x 0.09 x 3) = 26,035
What is $38,400 at 8.3% compounded annually for 2 years?
What is $45,038.94?
Because 38400(1+0.083/1)^1x2
At the end of one year, what would the total savings be on a principal of $100 at 4% annual interest, compounded quarterly?
What is $104.6?
Because 100 x (1 + 0.04/4) ^ 4 x 1 = 104.6
You want to save $500,000 for a house in 5 years at 5% interest. To find how much to save, which variable are you solving for?
What is (PV) Present Value?
The original amount of money that is borrowed or invested before interest is added.
What is Principal?
What is $14,145 at 7% for 11 years?
What is $25,036.65?
Because 14,145 + (14,145 x 0.07 x 11) = 25,036.65
What is $164 at 6.8% compounded quarterly for 5 years?
What is $225.43?
Because 164(1+0.064/4)^(4x5)
At then end of two years, what would the total savings be on a principal of $1,000 at 6% annual interest, compounded monthly?
What is $1,127.16?
Because 1000 (1 + 0.06/12) ^12 x 2 = 1,127.16
You are offered the opportunity to purchase a security that will make a single payment of $50,000. The payment will be made 30 years from today. Based on the returns offered by other securities of similar risk, you believe that you should receive an annualized return of at least 12% on your investment. What is the maximum amount that you should be willing to pay for the security?:
What is $1,668.896194?
This represents how much a value an asset loses over time due to age, tears, or wear.
What is Depreciation?