# Finance Quiz

- What is the formula for calculating simple interest?
- What is the formula for calculating compound interest?
- What is the term for the amount of money borrowed or invested, also known as the principal?
- What is the term for the rate at which interest is charged or earned?
- What is the term for the length of time for which interest is calculated?
- A sum of $5,000 is invested at a rate of 6% per annum for 2 years. What is the simple interest earned?
- A sum of $10,000 is invested at a rate of 8% per annum compounded annually for 3 years. What is the compound interest earned?
- Which type of interest pays interest on both the principal and any accumulated interest?
- A sum of $2,500 is invested at a rate of 4% per annum compounded quarterly for 2 years. What is the compound interest earned?
- Which type of interest is calculated only on the principal amount?
- A sum of $1,000 is invested at a rate of 5% per annum compounded semi-annually for 3 years. What is the compound interest earned?
- A sum of $8,000 is invested at a rate of 10% per annum compounded annually for 5 years. What is the compound interest earned?
- What is the term for the frequency with which interest is compounded?
- A sum of $12,000 is invested at a rate of 9% per annum compounded annually for 4 years. What is the total amount of money in the account at the end of 4 years?
- A sum of $6,000 is invested at a rate of 3.5% per annum compounded quarterly for 1 year. What is the total amount of money in the account at the end of 1 year?

P × r × t

P × r × n

P × (1 + r)t

P × (1 + r)t

P × r × t

P × r × n

Rate

Interest

Principal

Interest

Rate

Time

Time

Rate

Interest

$500

$400

$600

$2,208

$2,944

$1,800

Compound interest

Simple interest

Annual interest

$220.20

$214.32

$208.50

Compound interest

Simple interest

Annual interest

$162.89

$166.38

$160.38

$4,804.00

$4,613.36

$4,451.52

Time

Rate

Compounding period

$17,220

$19,440

$18,360

$6,250.00

$6,262.39

$6,236.74