compound

interest
General Mathematics
Grade 11 _ Quarter 2
 Compound
interest
is calculated as the difference between
the compound amount and the original or
principal amount. It is calculated as:

Ic = F – P
 remember!!
f p ic
Present Value Compound
Future
or Principal
Interest
Value Value
If the maturity/future value is
unknown, we use the formula:
𝐅=𝐏(𝟏+𝐫)^t
f p ic
Present Value Compound
Future
or Principal
Interest
Value Value
 but if the present value is
unknown, we use the formula:
P = F (1 + r)^-t or P =
f
𝑭/(𝟏+𝒓)𝒕
p R
Future Value Present Value Compound Interest

R or Principal t
interest rate Value term/s in years
 examples
example 1 example 2
If ₱ 20,000 is deposited in a Find the maturity value and
savings account at an annual rate the compound interest if ₱
of 5%, what will be the amount 20, 500 is compounded
in the account at the end of 3
years if the interest is
annually at an interest rate of
compounded annually? 3% in 7 years.
 examples
example 3
Find the maturity value and
the compound interest if ₱
20, 500 is compounded
annually at an interest rate
of 3% in 7 years.
example 4
Find the future value and the
compound interest if ₱ 50
000 is compounded annually
at an interest rate of 2 % in
5 years
 (1) try this!!
Peter borrowed ₱ 100
000 at 8% compounded
annually. How much will be
he paying after 2 years?
 (2) try this!!
Lorna will receive ₱ 21
500 from her investment
after 10 years at 12%
compounded annually. Find
the present value.
 (3) try this!!
Anthony borrowed ₱150 000
from a lending company where
he needs to pay an interest rate
of 3% compounded annually in 3
years. Find the maturity
value and the compound interest
of the loan.
thank you
for
listening!!