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11th Grade Simple and Compound Interest Worksheet — Level 3 — Practice Set 3 — Answers

Answer sheet with worked solutions for the 11th Grade financial math worksheet.

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11th Grade Simple and Compound Interest Worksheet — Level 3 — Practice Set 3 — Answers

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

1.Compare $4,000.00 invested for 3 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: $7.56

  1. Simple: I = $4,000.00 × 0.025 × 3 = $300.00
  2. Compound: A = $4,000.00 × 1.0253 ≈ $4,307.56, so interest ≈ $307.56
  3. Difference = $307.56 − $300.00 = $7.56
2.Compare $7,750.00 invested for 3 years at 8% per year as simple interest and as interest compounded yearly. How much more does compound interest earn, to the nearest cent?

Answer: $152.77

  1. Simple: I = $7,750.00 × 0.08 × 3 = $1,860.00
  2. Compound: A = $7,750.00 × 1.083 ≈ $9,762.77, so interest ≈ $2,012.77
  3. Difference = $2,012.77 − $1,860.00 = $152.77
3.$15,000.00 is invested at 6% per year, compounded yearly, for 6 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $21,277.79; interest $6,277.79

  1. A = P(1 + r)n = $15,000.00 × (1 + 0.06)6
  2. = $15,000.00 × 1.418519
  3. ≈ $21,277.79
  4. Interest = $21,277.79 − $15,000.00 = $6,277.79
4.Compare $13,750.00 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: $34.38

  1. Simple: I = $13,750.00 × 0.05 × 2 = $1,375.00
  2. Compound: A = $13,750.00 × 1.052 ≈ $15,159.38, so interest ≈ $1,409.38
  3. Difference = $1,409.38 − $1,375.00 = $34.38
5.Compare $10,500.00 invested for 7 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: $91.20

  1. Simple: I = $10,500.00 × 0.02 × 7 = $1,470.00
  2. Compound: A = $10,500.00 × 1.027 ≈ $12,061.20, so interest ≈ $1,561.20
  3. Difference = $1,561.20 − $1,470.00 = $91.20
6.Compare $9,500.00 invested for 10 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: $180.45

  1. Simple: I = $9,500.00 × 0.02 × 10 = $1,900.00
  2. Compound: A = $9,500.00 × 1.0210 ≈ $11,580.45, so interest ≈ $2,080.45
  3. Difference = $2,080.45 − $1,900.00 = $180.45
7.$10,750.00 is invested at 4% per year, compounded yearly, for 8 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $14,712.12; interest $3,962.12

  1. A = P(1 + r)n = $10,750.00 × (1 + 0.04)8
  2. = $10,750.00 × 1.368569
  3. ≈ $14,712.12
  4. Interest = $14,712.12 − $10,750.00 = $3,962.12
8.$10,250.00 is invested at 4.5% per year, compounded yearly, for 10 years. Find the final amount and the interest earned, to the nearest cent.

Answer: Amount $15,917.94; interest $5,667.94

  1. A = P(1 + r)n = $10,250.00 × (1 + 0.045)10
  2. = $10,250.00 × 1.552969
  3. ≈ $15,917.94
  4. Interest = $15,917.94 − $10,250.00 = $5,667.94
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