Simple and Compound Interest

Remember Ior Simple Interest

And Ior Compound Interest



(1) The simple interest on $15000 Ior 4 years is $8100. calculate the rate percent per annum.

(2)The simple interest on a sum oI money invested at 3 per annum Ior 2 years was $39.75. Calculate the
sum oI money invested.

(3)Henry opened a bank account with $550. AIter one year, the bank paid him interest. Henry now had
$650 in his account.
a. Work out, as a percentage, the bank`s rate oI interest.
Gill opened an account at a diIIerent bank. The banks rate oI interest was 6. AIter one year the bank
paid Gill interest. The amount in her account was now $2306
b. Calculate the amount oI money Gill used to open her account.

(4)Anna puts $2500 in the bank and leIt it Ior 2 years. At the end oI the two years she Iound that she had
$2700. Calculate
i. the simple interest earned
ii. the annual rate percent paid by the bank

(5)Pamela borrows $2500 at 12 per annum simple interest Ior 2 years. In addition, a Iee oI $200 is
charged Ior processing the loan. Calculate
i. the sum oI money which she will have to repay the bank at the end oI 2 years.
ii. the proIit percent the bank makes on the loan
iii. the monthly installment, iI she is required to repay the loan in 24 equal monthly installments.



I PRT P 100 I R 100 I T 100 I
%' #' #%
To Iind the amount accumulated aIter n years on principal P invested at R percent p.a.
A P( 1 + R )
n
Compound Interest Principal - Amount
100
(6)A man deposited $800 in his account at a bank which oIIers 6 simple interest per annum.
i. How much interest would he receive on the $800 aIter 9 months?
ii. How long would it take Ior the $800 to increase to $992?
(7)Mary borrowed $3000. at a rate oI 8 per annum. Interest is compounded annually. Calculate the total
amount owed at the end oI two years.
(8)Mr. Singh bought a new car Ior $14 000. Each year the car`s value depreciates by 16.

What will be the value oI the car at the end oI three years?

(9)A postage stamp increases in value by 15 each year. II it is bought Ior $50, what will it be worth in 3
years time?
(10)A man bought a car Ior $60320. AIter using it Ior 2 years he decides to trade in the car. The company
estimated a depreciation oI 10 Ior the Iirst year oI its use and a Iurther 15 on its reduced value Ior
the second year.
(a) Calculate the value oI the car aIter two years.
(b) Express the value oI the car aIter two years as a percentage oI the original value.