Gr12 Mathematics: Ch 3.5 Analysing Investment and Loan Options

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What is the formula for simple interest?

A = P(1 + i)^n
A = P(1 + in) (correct)
A = P - Pin
A = P(1 - in)

What is the formula for compound depreciation?

A = P - Pin
A = P(1 - i)^n (correct)
A = P / in
A = P(1 + i)^n

What is the formula for the effective annual rate (EAR)?

EAR = i_nominal * m
EAR = i_nominal / m
EAR = m / i_nominal
EAR = (1 + i_nominal / m)^m - 1 (correct)

What is the formula for the future value of an annuity?

F = x * [(1 + i)^n - 1] / i (A) Signup and view all the answers

What is the formula for the present value of an annuity?

P = x * [1 - (1 + i)^(-n)] / i (C) Signup and view all the answers

What is the formula for calculating the period of an investment using compound interest?

n = log(A / P) / log(1 + i) (C) Signup and view all the answers

What is the formula for calculating the outstanding loan balance?

P_balance = x * [1 - (1 + i)^(-n_remaining)] / i (A) Signup and view all the answers

What is the formula for total interest paid on a loan?

I = T - P (A) Signup and view all the answers

If a bank offers a 10% annual interest rate compounded semi-annually, what is the effective annual rate?

10.25% (D) Signup and view all the answers

What is the future value of an annuity with a regular payment of $100, an interest rate of 5% per year, and 5 years?

531.18 (A) Signup and view all the answers

A company borrows $10,000 at an annual interest rate of 8% for 5 years. What is the total amount paid?

14,400 (C) Signup and view all the answers

What is the present value of an annuity with a regular payment of $500, an interest rate of 4% per year, and 10 years?

4,194.19 (A) Signup and view all the answers

A car depreciates at a rate of 15% per year. If the initial price is $20,000, what is the value after 3 years?

11,390.62 (D) Signup and view all the answers

What is the monthly payment for a loan of $15,000 at an annual interest rate of 6% for 5 years?

294.49 (D) Signup and view all the answers

If the principal amount is $5,000 and the interest rate is 3% per year, how many years will it take for the amount to double?

23.45 years (A) Signup and view all the answers

A company has a loan of $8,000 at an annual interest rate of 7% for 3 years. What is the outstanding loan balance after 2 years?

5,341.19 (D) Signup and view all the answers

A company invests $10,000 at an annual interest rate of 5% compounded quarterly for 10 years. What is the accumulated amount?

$16,288.95 (A) Signup and view all the answers

A car depreciates at a rate of 12% per year. If the initial price is $25,000, what is the value after 5 years?

$12,544.80 (D) Signup and view all the answers

A company borrows $15,000 at an annual interest rate of 9% for 8 years. What is the total interest paid?

$10,311.91 (C) Signup and view all the answers

If the effective annual rate is 8.24%, and the nominal interest rate is 8% per year, how many times per year is the interest compounded?

4 (A) Signup and view all the answers

A person invests $500 per month for 20 years at an annual interest rate of 6%. What is the future value of the annuity?

$243,939.42 (D) Signup and view all the answers

A company has a loan of $20,000 at an annual interest rate of 7% for 10 years. What is the monthly payment amount?

$212.47 (D) Signup and view all the answers

If the principal amount is $8,000 and the interest rate is 4% per year, how many years will it take for the amount to triple?

24.03 years (D) Signup and view all the answers

A person has a loan of $12,000 at an annual interest rate of 5% for 15 years. What is the outstanding loan balance after 10 years?

$7,341.93 (A) Signup and view all the answers