Test: Interest - SAT MCQ

To calculate compound interest, we use the formula A = P(1 + r/n)^(nt), where A is the ending amount, P is the principal, r is the interest rate, n is the number of times the interest is compounded per year, and t is the number of years.
Plugging in the values,
we get A = 1,000(1 + 0.04/1)^(1x3)
= $1,124.86

Using the formula for simple interest,
I = Prt, where P = 800, r = 6%, and t = 1.5 years,
we get I = 8000.061.5
= $72

Using the formula for compound interest,
A = P(1 + r/n)^(nt), where P = 500, r = 10%, t = 3 years, and n = 2 (compounded semi-annually),
we get A = 500(1 + 0.1/2)^{(2 x 3)}
= $684.70

Using the formula for compound interest, A = P(1 + r/n)^(nt), where P = 1000, r = 5%, t = 2 years, and n = 1 (compounded annually),
we get A = 1000(1 + 0.05/1)^(1x2)
= $1102.50

The formula for compound interest is A = P(1 + r/n)^(nt), where A is the amount after time t, P is the principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the time in years. Plugging in the given values,
we get A = 1,000(1 + 0.04/4)^(4x5)
= $1,217.86.
Round to the nearest cent, the answer is B) $1,217.86.

To find the simple interest,
we use the formula: Interest (I) = Principal (P) x Rate (R) x Time (T).
Here, P = $1,000, R = 5/100 = 0.05, and T = 3 years.
Therefore, I = 1000 x 0.05 x 3 = $150.

Using the simple interest formula, I = P x R x T,
we can find the interest rate: R = I / (P x T).
Here, I = $60, P = $500, and T = 2 years.
Therefore, R = 60 / (500 x 2)
= 0.06 or 6%.

To find the total amount, we use the formula: A = P x (1 + R)^T.
Then we subtract the principal to find the interest earned.
Here, P = $5,000, R = 0.03, and T = 5 years.
Therefore, A = 5000 x (1.03)⁵ = $5796.
The interest earned is $5796 - $5000 = $796.

Using the simple interest formula, I = P x R x T,
we can find the interest rate: R = I / (P * T). Here, I = $200, P = $1,000, and T = 5 years.
Therefore, R = 200 / (1000 x 5)
= 0.04 or 4%.