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Compound Interest Practice Worksheet 4

This document contains a practice worksheet on compound interest calculations. It provides 8 example calculations involving determining future values of investments given interest rates and time periods, determining original investment amounts given future values, and determining time periods for investments to double given interest rates. The goal is to practice calculating compound interest in various scenarios.

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Nhed'z Abd Arola
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876 views2 pages

Compound Interest Practice Worksheet 4

This document contains a practice worksheet on compound interest calculations. It provides 8 example calculations involving determining future values of investments given interest rates and time periods, determining original investment amounts given future values, and determining time periods for investments to double given interest rates. The goal is to practice calculating compound interest in various scenarios.

Uploaded by

Nhed'z Abd Arola
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
  • Question 1: Calculates the future value of a $20,000 investment for a college education with a 7% annual compound interest rate.
  • Question 3: Determines the required deposit for a set future value with 6% compounded semiannual interest.
  • Question 4: Explores the future value of an IRA deposit growing with 9.8% interest compounded monthly to age 55.
  • Question 2: Compares two investment options to determine which yields better returns with different interest compounding rates.
  • Question 8: Finds the time required to double an investment at 6% annual interest compounded monthly.
  • Question 5: Assesses the principal on an investment that grows to $3,500 with 5.3% daily compound interest over 10 years.
  • Question 7: Determines original deposit from current account balance compounded weekly over three years at 4.35% annual rate.
  • Question 6: Calculates interest earned on a loan compounded at 3.25% monthly over 19 years.

Compound Interest Practice Worksheet

Name______________________________________________________________Date____________________

1. A newborn child receives a $20,000 gift toward a college education from her grandparents.
How much will the $20,000 be worth in 17 years if it is invested at 7% and compounded
quarterly?

2. If you invest $10,000 in a bank which one is a better investment?

a) 9% compounded monthly

b) 9.3% compounded annually

3. If an investment company pays 6% compounded semiannually, how much should you deposit
now to have $10,000 5 years from now?

4. At age 27, Jill deposited $4,000 into an IRA, where it earns 9.8 % interest compounded monthly.
What will it be worth when she is thirty-five?
5. If you have $3,500 after 10 years on an investment that pays 5.3% compounded daily, what
was the principle amount you started with?

6. A $175,000 loan compounded monthly at 3.2% for 19 years. How much interest was earned?

7. Your savings account has a balance of $2513.45. You opened the account 3 years ago.
Interest on the account is compounded weekly at an annual interest rate of 4.35%. How
much did you invest originally?

8. You deposit $1000 in an account that pays 6% annual interest. Find how long it will take for the
amount to double if the interest is compounded quarterly.

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