1. The document discusses calculating simple and compound interest on various principal amounts with different interest rates and time periods. 2. Formulas provided include the simple interest formula I=prt and the compound interest formula B=p(1+r)n. 3. Examples are given of calculating simple interest earned over 6 years on $400 at 5% interest, and compound interest balances after 4 years on an initial $400 deposit at 5% interest compounded annually.

1. Objective: calculate simple and compound interest Find each amount. 1. 6% of $400 2. 4.5% of $700 3. 5.5% of $325 Bellwork Solve for p. 4. I = prt 5. 3p + 4 = k

2. principal - money first deposited interest - money you earn on principal interest rate - simple interest - only paid on principal Simple Interest Formula I = prt

3. Suppose you deposit $400 in a savings account. The interest rate is 5% per year. Find the simple interest earned in six years. Find the total of principal plus interest. Find the interest earned in three months. Find the total principal plus interest.

4. Compound interest - when a bank pays interest on the principal and on the interest an account has earned. You deposit $400 in an account that earns 5% interest compounded annually. What is the balance in your account after 4 years? In your last calculation, round to the nearest cent. Principal at Beginning of Year Interest Balance Year 1 Year 2 Year 3 Year 4

5. Compound-Interest Formula B = p(1 + r) n final balance principal interest rate number of interest periods Find the balance on a deposit of $1,000 that earns 6% interest compounded semiannually for 5 years.

6. Find the balance for each account. Amount deposited: $900, annual interest: 2%, time: 3 years a) compounded annually b) compounded semiannually

7. HW pg. 385 # 1-15 odd