Simple Interest Compound Interest and Consumer Loans.

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Presentation transcript:

Simple Interest Compound Interest and Consumer Loans

Formulas Simple Interest Future Value Formula Interest Earned

Jenna buys a bedroom set at Fowler’s Furniture for $3,700. She puts $500 down and finances the rest through the store at 9.8% add-on interest. If she agrees to make 36 monthly payments, find the size of each payment.

The activity on Sophie Jones’s Sears account for one billing period is shown below. Find the average daily balance and the finance charge if the billing period is March 1 through March 31. The previous balance was $157.14, and the annual interest rate is 21%. March 5payment$25.00 March 17tools$36.12

Formulas Compound Interest Future Value Formula

When Mike Jones was born, his grandparents deposited $5,000 into a special account for Mike’s college education. The account earned 7¼ % interest compounded daily. How much will be in the account when Mike is eighteen?