Interest Problems with Exponential Growth & Decay
Algebra 2
where
= the amount of money in the account,
is the principal (amount of money initially
saved or borrowed),
is the interest rate (
be sure to convert percent to de
cimal),
is the number of times interest is compounded per year and
is the time in years
A. Determine the value of
for the following scenarios
1. Interest is compounded quarterly
2. Interest is compounded semi-annually
3. Interest is compounded monthly
4. Interest is compounded daily
B. See if you can solve the following (you can work with a partner) by substituting the appropriate
values into the compound interest formula
8.25%, compounded quarterly, for 8 years.
8.25%, compounded monthly, for 8 years.
, compounded annually, for 22 years.
compounded daily, for 22 years.
compounded semi-annually (twice a year), for 9 years.