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Year 9 Simple and Compound Interest Worksheet — Level 3 — Practice Set 4 — Answers

Answer sheet with worked solutions for the Year 9 financial mathematics worksheet.

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Success TutoringWorksheetsAnswer sheetYear 9 · Mathematics · Financial Mathematics

Year 9 Simple and Compound Interest Worksheet — Level 3 — Practice Set 4 — Answers

Show your working. Write the rate as a decimal (5% = 0.05). Round money to the nearest cent.

1.Compare $5,250.00 invested for 4 years at 5% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $81.41

  1. Simple: I = $5,250.00 × 0.05 × 4 = $1,050.00
  2. Compound: A = $5,250.00 × 1.054 ≈ $6,381.41, so interest ≈ $1,131.41
  3. Difference = $1,131.41 − $1,050.00 = $81.41
2.Compare $3,500.00 invested for 6 years at 2% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $21.57

  1. Simple: I = $3,500.00 × 0.02 × 6 = $420.00
  2. Compound: A = $3,500.00 × 1.026 ≈ $3,941.57, so interest ≈ $441.57
  3. Difference = $441.57 − $420.00 = $21.57
3.Compare $4,250.00 invested for 5 years at 4% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $70.77

  1. Simple: I = $4,250.00 × 0.04 × 5 = $850.00
  2. Compound: A = $4,250.00 × 1.045 ≈ $5,170.77, so interest ≈ $920.77
  3. Difference = $920.77 − $850.00 = $70.77
4.$12,750.00 is invested at 3% per year, compounded yearly, for 3 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $13,932.27; interest $1,182.27

  1. A = P(1 + r)n = $12,750.00 × (1 + 0.03)3
  2. = $12,750.00 × 1.092727
  3. ≈ $13,932.27
  4. Interest = $13,932.27 − $12,750.00 = $1,182.27
5.$10,750.00 is invested at 3% per year, compounded yearly, for 9 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $14,026.31; interest $3,276.31

  1. A = P(1 + r)n = $10,750.00 × (1 + 0.03)9
  2. = $10,750.00 × 1.304773
  3. ≈ $14,026.31
  4. Interest = $14,026.31 − $10,750.00 = $3,276.31
6.Compare $14,750.00 invested for 2 years at 5% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $36.88

  1. Simple: I = $14,750.00 × 0.05 × 2 = $1,475.00
  2. Compound: A = $14,750.00 × 1.052 ≈ $16,261.88, so interest ≈ $1,511.88
  3. Difference = $1,511.88 − $1,475.00 = $36.88
7.Compare $10,250.00 invested for 5 years at 4% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $170.69

  1. Simple: I = $10,250.00 × 0.04 × 5 = $2,050.00
  2. Compound: A = $10,250.00 × 1.045 ≈ $12,470.69, so interest ≈ $2,220.69
  3. Difference = $2,220.69 − $2,050.00 = $170.69
8.$4,750.00 is invested at 5% per year, compounded yearly, for 8 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $7,017.91; interest $2,267.91

  1. A = P(1 + r)n = $4,750.00 × (1 + 0.05)8
  2. = $4,750.00 × 1.477455
  3. ≈ $7,017.91
  4. Interest = $7,017.91 − $4,750.00 = $2,267.91
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