Section PF.8 – Practice Problems

Note: If your final answer is a dollar amount then it should be rounded to the nearest cent.

1. You deposit $300.00 in an account earning 5% interest compounded annually. How much will you have in the account in 10 years?

2. How much will $1,000.00 deposited in an account earning 7.38% interest compounded daily be worth in 20 years?

3. You deposit $9,400.00 in an account earning [latex]4\frac{1}{8}[/latex]% interest compounded semi-annually. How much will you have in the account in 5 years?

4. You deposit $2,100.00 in an account earning 2.5% interest compounded weekly. How much will you have in the account in 7 years?

5. You deposit $4,000.00 in an account earning 8% interest compounded monthly. How much will you have in the account in 10 years?

6. You deposit $200.00 in an account earning 5.2% interest compounded quarterly. How much will you have in the account in 15 years?

7. You deposit $2,000.00 in an account earning 3% interest compounded monthly.

a. How much money will you have in the account in 20 years?
b. How much interest will you earn?

8. You deposit $10,000.00 in an account earning 4% interest compounded semi-annually.

a. How much money will you have in the account in 25 years?
b. How much interest will you earn?

9. You deposit $5,300.00 in an account earning 5% interest compounded quarterly. How much will you have in the account in 6 years?

10. You deposit $7,050.00 in an account earning 3.5% interest compounded weekly. How much will you have in the account in 8 years?

11. You deposit $3,000.00 in an account earning 8% interest compounded annually. How much will you have in the account in 10 years?

12. You deposit $200.00 in an account. Find the value of the investment at the end of 3 years if the account earns 7% interest.

a. compounded annually
b. compounded monthly
c. compounded weekly
d. compounded daily

13. How much would you need to deposit in an account now in order to have $4,000.00 in the account in 10 years? Assume the account earns 3% interest compounded monthly. How much interest will you earn?

14. How much would you need to deposit in an account now in order to have $2,500.00 in the account in 5 years? Assume the account earns 2.5% interest compounded quarterly. How much interest will you earn?

15. How much would you need to deposit in an account now in order to have $6,000.00 in the account in 8 years? Assume the account earns [latex]6\frac{3}{5}[/latex]% interest compounded daily.

16. How much would you need to deposit in an account now in order to have $20,000.00 in the account in 10 years? Assume the account earns 7% interest compounded weekly.

17. How much would you need to deposit in an account now in order to have $3,000.00 in the account in 15 years? Assume the account earns 2% interest compounded semi-annually.

18. How much would you need to deposit in an account now in order to have $7,000.00 in the account in 10 years? Assume the account earns 3.84% interest compounded annually.

19. You deposit $23,000.00 in an account. Find the value of the investment at the end of 10 years if the account earns:

a. 7% interest compounded annually
b. 7% simple interest

20. You deposit $4,000.00 in an account. Find the value of the investment at the end of 10 years if the account earns:

a. 5% interest compounded annually
b. 5% simple interest