"Understanding Simple Interest" is a fundamental financial literacy course designed to empower individuals with the knowledge and skills to comprehend, calculate, and apply simple interest in various financial scenarios. This course is perfect for anyone seeking to manage personal finances, make informed borrowing or lending decisions, or develop a foundation in financial mathematics.
4GMAT Diagnostic Test Q8 - Problem Solving : Simple and Compound Interest4gmatprep
This one is a simple problem solving question from the topic simple and compound interest. Such easy questions appear as low level difficulty question in the GMAT test. This question tests your ability to recall simple and compound interest formulas and apply them.
Robin invested $1000 in a 12% simple interest savings deposit for 3 years. He also invested an equal amount in a 10% compound interest savings deposit for 3 years. At the end of 3 years, how much more interest did he get from the simple interest deposit?
$31
$60
$39
$29
$390
Assignment 1 for Unit 2.You have to SHOW your work (show how you.docxtrippettjettie
Assignment 1 for Unit 2.
You have to SHOW your work (show how you get the answers) to get credit. The answers to these problems are given to you on a separate file.
Below are the formulas for each type of loan and bonds. Use the respective formula regarding a respective question: for example, on questions regarding a simple loan use the simple loan formula, on questions regarding a fixed payment loan question use the fixed payment loan formula, and so on.
You also have to know the formulas for the test.
Future Value :
F
C
rate
coupon
=
FV= future value, PV= present value, i= interest rate, N= number of years.
.
Present Value:
(1)
N
FV
PV
i
=
+
FV= future value, PV= present value, i= interest rate, N= number of years.
Simple loan:
(1)
N
FVPVi
=+
FV = future value, i = interest rate, n = number of years
Fixed payment loan:
n
i
FV
loan
)
1
(
+
=
FP = fixed payment, i = interest rate, n = number of years
n
i
FP
i
FP
i
FP
loan
)
1
(
...
)
1
(
)
1
(
2
1
+
+
+
+
+
+
=Coupon bond:
P = price of bond, i = interest rate, n = number of years, c = coupon payment, and F = face value of the bond.
n
i
F
C
i
C
i
C
P
)
1
(
...
)
1
(
)
1
(
2
1
+
+
+
+
+
+
+
=
P = price of bond, C = coupon payment
P
C
yield
current
=
F = face value, C = coupon payment
Discount Bond:
F
C
rate
coupon
=
P = price of bond, i = interest rate, n = number of years, F = face value
Yield to maturity on a discount bond with less than a year of maturity:
n
i
F
P
)
1
(
+
=
P = price of bond, F = Face value, G = number of days to maturity.
Yield on discount basis on a bond with less than a year of maturity:
G
P
P
F
ytm
365
*
-
=
P = price of bond, F = face value
G
F
P
F
basis
discount
on
yield
360
*
-
=Consol bond:
P = price of bond, i = interest rate
Bring the answers to the following questions to Class
simple loan:
1. End of ten years you will pay back $20,000. If I = 6% , how much is the loan amount now.
2. If you borrowed $9900 at i = 10% to pay back at
the end of 15 years, how much money do you pay
back?
3. You will receive $35,000 at the end of two
years. Its present value is $20,000. The yield to maturity equals what?
fixed payment loan:
1. i = 9%, loan = $15,000, 5 year loan. The fixed payment =___.
2. The fixed payment = $7000,
i. i= 9%, 3 years, loan =___
coupon bond:
1. coupon payment = $100, face value = $6000,
i = 5%, 4 years, a) price of bond =___ b) coupon rate =___ c) current yield =____
2. Coupon rate = 5%, face value = $12,000, i = 7% a) price of bond for a) 1 year bond=___, b) 2
year bond =____ c) 3 year bond =_____
3. if i increases to 12% , what happens to each
of the prices (in a) above.
discount bond (zero coupon bond):
1. Face value = $20,000, price = $19,000, 1 year bond, ytm = _
2. Face value = $20,000, price 19,000, 1 year bond , number of days to maturity = 90 days. a) ytm =_______ b) yield on discount basis =___
3. Fac ...
"Understanding Simple Interest" is a fundamental financial literacy course designed to empower individuals with the knowledge and skills to comprehend, calculate, and apply simple interest in various financial scenarios. This course is perfect for anyone seeking to manage personal finances, make informed borrowing or lending decisions, or develop a foundation in financial mathematics.
4GMAT Diagnostic Test Q8 - Problem Solving : Simple and Compound Interest4gmatprep
This one is a simple problem solving question from the topic simple and compound interest. Such easy questions appear as low level difficulty question in the GMAT test. This question tests your ability to recall simple and compound interest formulas and apply them.
Robin invested $1000 in a 12% simple interest savings deposit for 3 years. He also invested an equal amount in a 10% compound interest savings deposit for 3 years. At the end of 3 years, how much more interest did he get from the simple interest deposit?
$31
$60
$39
$29
$390
Assignment 1 for Unit 2.You have to SHOW your work (show how you.docxtrippettjettie
Assignment 1 for Unit 2.
You have to SHOW your work (show how you get the answers) to get credit. The answers to these problems are given to you on a separate file.
Below are the formulas for each type of loan and bonds. Use the respective formula regarding a respective question: for example, on questions regarding a simple loan use the simple loan formula, on questions regarding a fixed payment loan question use the fixed payment loan formula, and so on.
You also have to know the formulas for the test.
Future Value :
F
C
rate
coupon
=
FV= future value, PV= present value, i= interest rate, N= number of years.
.
Present Value:
(1)
N
FV
PV
i
=
+
FV= future value, PV= present value, i= interest rate, N= number of years.
Simple loan:
(1)
N
FVPVi
=+
FV = future value, i = interest rate, n = number of years
Fixed payment loan:
n
i
FV
loan
)
1
(
+
=
FP = fixed payment, i = interest rate, n = number of years
n
i
FP
i
FP
i
FP
loan
)
1
(
...
)
1
(
)
1
(
2
1
+
+
+
+
+
+
=Coupon bond:
P = price of bond, i = interest rate, n = number of years, c = coupon payment, and F = face value of the bond.
n
i
F
C
i
C
i
C
P
)
1
(
...
)
1
(
)
1
(
2
1
+
+
+
+
+
+
+
=
P = price of bond, C = coupon payment
P
C
yield
current
=
F = face value, C = coupon payment
Discount Bond:
F
C
rate
coupon
=
P = price of bond, i = interest rate, n = number of years, F = face value
Yield to maturity on a discount bond with less than a year of maturity:
n
i
F
P
)
1
(
+
=
P = price of bond, F = Face value, G = number of days to maturity.
Yield on discount basis on a bond with less than a year of maturity:
G
P
P
F
ytm
365
*
-
=
P = price of bond, F = face value
G
F
P
F
basis
discount
on
yield
360
*
-
=Consol bond:
P = price of bond, i = interest rate
Bring the answers to the following questions to Class
simple loan:
1. End of ten years you will pay back $20,000. If I = 6% , how much is the loan amount now.
2. If you borrowed $9900 at i = 10% to pay back at
the end of 15 years, how much money do you pay
back?
3. You will receive $35,000 at the end of two
years. Its present value is $20,000. The yield to maturity equals what?
fixed payment loan:
1. i = 9%, loan = $15,000, 5 year loan. The fixed payment =___.
2. The fixed payment = $7000,
i. i= 9%, 3 years, loan =___
coupon bond:
1. coupon payment = $100, face value = $6000,
i = 5%, 4 years, a) price of bond =___ b) coupon rate =___ c) current yield =____
2. Coupon rate = 5%, face value = $12,000, i = 7% a) price of bond for a) 1 year bond=___, b) 2
year bond =____ c) 3 year bond =_____
3. if i increases to 12% , what happens to each
of the prices (in a) above.
discount bond (zero coupon bond):
1. Face value = $20,000, price = $19,000, 1 year bond, ytm = _
2. Face value = $20,000, price 19,000, 1 year bond , number of days to maturity = 90 days. a) ytm =_______ b) yield on discount basis =___
3. Fac ...
Snowball Effect: Imagine your money as a snowball rolling down a hill, gathering more snow. In finance, this snowball effect is akin to compound interest. As your initial investment earns interest, that interest is added to the principal, and subsequent interest is calculated on the more significant sum. This compounding cycle accelerates your wealth accumulation over time.
Time is Your Ally: The real magic of compound interest lies in the extended period over which it operates. The longer your money is allowed to compound, the more substantial the impact. Even small, regular contributions can lead to significant wealth accumulation when given enough time to grow.
The Art Pastor's Guide to Sabbath | Steve ThomasonSteve Thomason
What is the purpose of the Sabbath Law in the Torah. It is interesting to compare how the context of the law shifts from Exodus to Deuteronomy. Who gets to rest, and why?
How to Create Map Views in the Odoo 17 ERPCeline George
The map views are useful for providing a geographical representation of data. They allow users to visualize and analyze the data in a more intuitive manner.
How to Make a Field invisible in Odoo 17Celine George
It is possible to hide or invisible some fields in odoo. Commonly using “invisible” attribute in the field definition to invisible the fields. This slide will show how to make a field invisible in odoo 17.
The Indian economy is classified into different sectors to simplify the analysis and understanding of economic activities. For Class 10, it's essential to grasp the sectors of the Indian economy, understand their characteristics, and recognize their importance. This guide will provide detailed notes on the Sectors of the Indian Economy Class 10, using specific long-tail keywords to enhance comprehension.
For more information, visit-www.vavaclasses.com
Instructions for Submissions thorugh G- Classroom.pptxJheel Barad
This presentation provides a briefing on how to upload submissions and documents in Google Classroom. It was prepared as part of an orientation for new Sainik School in-service teacher trainees. As a training officer, my goal is to ensure that you are comfortable and proficient with this essential tool for managing assignments and fostering student engagement.
2. Gyan invests $5000 at a rate of 5.25% for
3 years. Calculate the amount of interest
Gyan has earned.
Simple Interest formula: I = P r t
3. Simple Interest formula: I = P r t
Where:
- I is the amount of interest
- P is the Principal amount invested or borrowed
- r is the rate of interest shown as a decimal
- t is time in years
4.
5. Jen borrows $7000 at a rate of 18.5% for
3 months. Calculate the amount of interest Jen
will pay.
6. Goitom has $10000 to invest. If he can get
an interest rate of 7.75%, how long will it
take for him to earn $1200 interest?
7. Sayana is planning a trip to Disney world in 7
months. She has $5000, and has determined
the trip will cost her $6000. What interest rate
must she get to have save enough money for
her trip?
