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Year 10 Simple and Compound Interest Worksheet — Level 3 — Answers

Answer sheet with worked solutions for the Year 10 financial mathematics worksheet.

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Success TutoringWorksheetsAnswer sheetYear 10 · Mathematics · Financial Mathematics

Year 10 Simple and Compound Interest Worksheet — Level 3 — Answers

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

1.$15,000.00 is invested at 4.5% per year, compounded yearly, for 4 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $17,887.78; interest $2,887.78

  1. A = P(1 + r)n = $15,000.00 × (1 + 0.045)4
  2. = $15,000.00 × 1.192519
  3. ≈ $17,887.78
  4. Interest = $17,887.78 − $15,000.00 = $2,887.78
2.$10,250.00 is invested at 4% per year, compounded yearly, for 3 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $11,529.86; interest $1,279.86

  1. A = P(1 + r)n = $10,250.00 × (1 + 0.04)3
  2. = $10,250.00 × 1.124864
  3. ≈ $11,529.86
  4. Interest = $11,529.86 − $10,250.00 = $1,279.86
3.Compare $9,250.00 invested for 9 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: $139.61

  1. Simple: I = $9,250.00 × 0.02 × 9 = $1,665.00
  2. Compound: A = $9,250.00 × 1.029 ≈ $11,054.61, so interest ≈ $1,804.61
  3. Difference = $1,804.61 − $1,665.00 = $139.61
4.Compare $15,000.00 invested for 5 years at 2.5% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $96.12

  1. Simple: I = $15,000.00 × 0.025 × 5 = $1,875.00
  2. Compound: A = $15,000.00 × 1.0255 ≈ $16,971.12, so interest ≈ $1,971.12
  3. Difference = $1,971.12 − $1,875.00 = $96.12
5.Compare $1,000.00 invested for 5 years at 6% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $38.23

  1. Simple: I = $1,000.00 × 0.06 × 5 = $300.00
  2. Compound: A = $1,000.00 × 1.065 ≈ $1,338.23, so interest ≈ $338.23
  3. Difference = $338.23 − $300.00 = $38.23
6.$12,250.00 is invested at 4.5% per year, compounded yearly, for 5 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $15,265.73; interest $3,015.73

  1. A = P(1 + r)n = $12,250.00 × (1 + 0.045)5
  2. = $12,250.00 × 1.246182
  3. ≈ $15,265.73
  4. Interest = $15,265.73 − $12,250.00 = $3,015.73
7.Compare $9,750.00 invested for 9 years at 6% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $1,457.42

  1. Simple: I = $9,750.00 × 0.06 × 9 = $5,265.00
  2. Compound: A = $9,750.00 × 1.069 ≈ $16,472.42, so interest ≈ $6,722.42
  3. Difference = $6,722.42 − $5,265.00 = $1,457.42
8.Compare $13,250.00 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: $81.65

  1. Simple: I = $13,250.00 × 0.02 × 6 = $1,590.00
  2. Compound: A = $13,250.00 × 1.026 ≈ $14,921.65, so interest ≈ $1,671.65
  3. Difference = $1,671.65 − $1,590.00 = $81.65
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