simple intrest
posted by Veronica on .
My daughter brought home a work sheet and I have no clue where to begin to help her and she seems to have no clue either.
the questions are
1. Find the final balance in each account.
$800 at 4.25% simple intrest for 6 years
2. $2,000 at 6% compounded annually for 3 years
please help us
1.
interest = principal x rate x time.
int = 800 x 0.0425 x 6 =??
int + 800 = final balance.
2.
You don't say what you want calculated here.
final balance = (1.00+rate)^{time}=(1.06)^{3} = ??
If you want the interest just subtract 2,000 from the final balance.
I hope this helps.
If some of the exponents don't print well I will post a quickie correction.
For simple interest, there is a formula:
I = P x r x t
I is the total interest , r is the rate, and t is the time. Thus, the final balance is the initial 800 + I.
For compound interest, it is a little more complicated. Find the new balance after one year by using the above. Then, you need the interest on the NEW balance for the second year (that is the difference between compound and simple), and then add this new interest to the balance after one year, and you have the end of second year balance. Then you do the same for the 3rd year.
There is a formula for compound interest, but it may be beyond your daughter's level.
It is M = P(1 + i)^n
where M is final amount, P is the principal, i is the rate, and n is the number of years.
Let me know if I can help further.
Here's a simple interest calculator:
http://www.webmath.com/simpinterest.html
And here's a compound interest calculator:
http://www.moneychimp.com/calculator/compound_interest_calculator.htm
=)
Correction to 2.
Obviously I omitted the principal.
final balance = 2,000*(1.06)^{3} = 2382.03
Le't see if this looks any better.

I got 834, and 1.70 write down that answer and write me back and tell me if its right my daughter asked me for help but i really don't get it please tell me if its right

the key to doing the problem is to emagine you were on ashopping spree and the sign said 4.5 pecent off of everything you need to act like you are shopping in order to get your am=nswer and it will determine what kind of salary you make in the future.

$1004.00

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Formula for Intrest:
I=prt (I party)
I Intrest
P Principal
R Rate
T Time (years) Month: x/12
    
I = 800 (4.25)(6)
B=p+I 800+ [ $20400 ] 
$800 AT 4.25% SIMPLE INTREST FOR 6 YEARS