MAA MATHEMATICAL ASSOCIATION OF AMERICA 20 Simple and Compound Interest / 1 Previous Problem Problem List Next Problem HW 20 Simple and Compound Interest: Problem 1 (10 points) (a) A $420 loan is taken out with a 3% simple annual interest rate for 11 years. Interest owed at the end of the loan: $ Total amount to repay after 11 years: $ (b) Theo invested $7700 in a savings bond. When it matured after 13 years, Theo cashed out the bond and received a total of $11453.75. The simple annual interest rate for Theo's bond: % (round to 2 decimal places) (c) Roxy borrowed money from her aunt 4 years ago. They agreed to a simple annual interest rate of 6% on the loan. Roxy is ready to pay back the loan and she has determined that she owes a total of $998.2 to her aunt. The amount Roxy originally borrowed (round to the nearest dollar): $ The total amount of interest that Roxy's aunt earns on the loan: $ (d) A $1250 deposit was made in an account that pays 3.7% simple annual interest. If the account was closed today, the total amount in the account would be $2125. How long ago was the deposit made into the account (round to 2 decimal places)? years Note: You can earn partial credit on this problem. Preview My Answers Submit Answers
MAA MATHEMATICAL ASSOCIATION OF AMERICA 20 Simple and Compound Interest / 1 Previous Problem Problem List Next Problem HW 20 Simple and Compound Interest: Problem 1 (10 points) (a) A $420 loan is taken out with a 3% simple annual interest rate for 11 years. Interest owed at the end of the loan: $ Total amount to repay after 11 years: $ (b) Theo invested $7700 in a savings bond. When it matured after 13 years, Theo cashed out the bond and received a total of $11453.75. The simple annual interest rate for Theo's bond: % (round to 2 decimal places) (c) Roxy borrowed money from her aunt 4 years ago. They agreed to a simple annual interest rate of 6% on the loan. Roxy is ready to pay back the loan and she has determined that she owes a total of $998.2 to her aunt. The amount Roxy originally borrowed (round to the nearest dollar): $ The total amount of interest that Roxy's aunt earns on the loan: $ (d) A $1250 deposit was made in an account that pays 3.7% simple annual interest. If the account was closed today, the total amount in the account would be $2125. How long ago was the deposit made into the account (round to 2 decimal places)? years Note: You can earn partial credit on this problem. Preview My Answers Submit Answers
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:MAA
MATHEMATICAL ASSOCIATION OF AMERICA
20 Simple and Compound Interest / 1
Previous Problem Problem List Next Problem
HW 20 Simple and Compound Interest: Problem 1
(10 points)
(a) A $420 loan is taken out with a 3% simple annual interest rate for 11 years.
Interest owed at the end of the loan: $
Total amount to repay after 11 years: $
(b) Theo invested $7700 in a savings bond. When it matured after 13 years, Theo cashed out the bond and received a total of $11453.75.
The simple annual interest rate for Theo's bond:
% (round to 2 decimal places)
(c) Roxy borrowed money from her aunt 4 years ago. They agreed to a simple annual interest rate of 6% on the loan. Roxy is ready to pay back the loan and she has determined that she owes a
total of $998.2 to her aunt.
The amount Roxy originally borrowed (round to the nearest dollar): $
The total amount of interest that Roxy's aunt earns on the loan: $
(d) A $1250 deposit was made in an account that pays 3.7% simple annual interest. If the account was closed today, the total amount in the account would be $2125.
How long ago was the deposit made into the account (round to 2 decimal places)? years
Note: You can earn partial credit on this problem.
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