©Zarestky
Math 141 Quiz 10 Version A
12/1/2009
NAME:________________________________________
1.
(2 points) $1500 is invested in an account paying 6.45% simple interest per year.
A. How much is in the account after 8 years?
A = P(1 + rt) = 1500(1 + 0.0645·8) = $2274
B. How much interest is earned?
Interest = Prt = A – P = 2274 – 1500 = $774
2.
(2 points) If an account paying 4% interest compounded annually has a balance of $1900 after 9 years,
how much was initially invested in the account?
N = 1·9 = 9
I% = 4
PV = ?
PMT = 0
FV = 1900
P/Y = 1
C/Y = 1
3.
(3 points) You deposit $2700 in a savings account paying 2.8% per year compounded quarterly. After
how many years will you have $3100 in the account?
N = ? = 19.8048
I% = 2.8
PV = –2700
PMT = 0
FV = 3100
P/Y = 4
C/Y = 4
3.
$1334.91 was initially invested.
19.8048/4 = 4.9512 years
(3 points) Your credit card has a balance of $800 on which you are paying interest at a rate of 20.5% per
year compounded monthly. How much should your payments be if you want to pay off the card in 3 years?
N = 12·3 = 36
I% = 20.5
PV = 800
PMT = ?
FV = 0
P/Y = 12
C/Y = 12
The payments should be $29.94.