Math 12F: Probability Quiz 1

Name ______

Math 12F: Exponential/Finance Test Review

Given Formulae

r Compound Interest Formula: A  P(1 )nt n

Where: A = value of the investment now P = amount invested at start r = interest rate (written as a decimal, ie: 8% = 0.08) t = time of the investment in years n = the number of time per year the interest is calculated

1. Travis deposits $700 into a fund that pay 4% interest compounded annually. How much will he have after 4 years if he doesn’t touch it? 2. Yulanda invests $4444 into a G.I.C. that pays 7.5% per year compounded semi- annually. If she doesn’t touch it, how much will she have in 3 years? 3. Kyle has a Mastercard with a balance owing of $300. The card has a payback rate of 15% compounded quarterly. How much will he owe after 2 years if he doesn’t pay any money into it? 4. Jordan starts saving for fashion school. She puts in an initial deposit of $500 and keeps putting that amount at the end of each year for 3 years. The fund pays 13% per year compounded annually. a. Draw a time diagram for the problem. b. Determine the future value of the investment. 5. Brandon is saving for a motorcycle in a fund that is compounded monthly at a rate of 8%. He makes an initial deposit of $500 and puts in $500 each year after that. How much money will he have after 3 years? 6. Jenna’s mom is saving money for her graduation next year (ie, 1 year). She puts money in a investment fund with an interest rate of 11.34%, compounded monthly. If Jenna’s mom wants her to have $2000.00 for graduation, how much will she have to deposit? 7. Write the following interest rates as decimals: a. 15% b. 9% c. 15.75% 8. A loan shows: a. Exponential growth b. Exponential decay c. Linear growth d. Linear decay