Chris Sears

Liberal Arts Mathematics Week 2 Information

Week 2 - Start Here

  1. Read Section 6.3 of the textbook. A PDF version is uploaded in the page “Simple Interest - Reading”. Focus on the subsections:
    • Compute Simple Interest
    • Understand and Compute Future Value
    • Understand and Compute Present Value for Simple Interest Investments
  2. Do the assignment “Simple Interest - Assignment”.
  3. Read Section 6.4 of the textbook. A PDF version is uploaded in the page “Compound Interest - Reading”. Focus on the subsections:
    • Understand and Compute Compound Interest
    • Understand and Compute Future Value
    • Understand and Compute Present Value
  4. Do the assignment “Compound Interest - Assignment”.

Simple Interest - Assignment

The problems are from Section 6.3 of the textbook. They are problems 19, 21, 22, 51, 41, 42, 43, 55.

In the following exercises, find the future value of the investment with the given principal, simple interest rate, and time.

19 . Principal is $5,300, annual interest rate is 2.07%, and time is 18 years.
21 . Principal is $5,600, annual interest rate is 2.55%, for 30 months.
22 . Principal is $10,000, annual interest rate is 1.99%, for 15 months.

51 . Sharon invests $2,500 in a CD for her granddaughter. The CD has a term of 5 years and has a simple interest rate of 3.11%. After that 5-year period, how much will the CD be worth?

In the following exercises, find the present value for the given future value, FV, annual simple interest rate r, and number of years t.

41 . FV = $25,000, t = 15 years, annual simple interest rate of 6.5%
42 . FV = $12,000, t = 10 years, annual simple interest rate of 4.5%
43 . FV = $15,000, t = 16 years, annual simple interest rate of 3.5%

55 . Kylie wants to invest some money in an account that yields 4.66% simple interest. Her goal is to have $20,000 in 15 years. How much should Kylie invest to reach that goal?

Compound Interest - Assignment

These problems are from section 6.4 of the textbook.

Answer the following problems with the following numbers: 11 - 14, 19 - 22, 35, 37.

For reference, the text of the problems are duplicated below.

11 . Principal = $13,800, annual interest rate = 2.55%, compounded quarterly, for 18 years
12 . Principal = $150,000, annual interest rate = 2.95%, compounded quarterly, for 30 years
13 . Principal = $3,500, annual interest rate = 2.9%, compounded monthly, for 7 years
14 . Principal = $1,500, annual interest rate = 3.23%, compounded monthly, for 30 years.

19 . Future value = $1,500,000, annual interest rate = 4.81%, compounded quarterly, for 35 years
20 . Future value = $750,000, annual interest rate = 3.95%, compounded quarterly, for 10 years
21 . Future value = $600,000, annual interest rate = 3.79%, compounded monthly, for 17 years
22 . Future value = $800,000, annual interest rate = 4.23%, compounded monthly, for 35 years

35 . Daria invests $2,500 in a CD that yields 3.5% compounded quarterly for 5 years. How much is the CD worth after those 5 years?
37 . Georgita is shopping for an account to invest her money in. She wants the account to grow to $400,000 in 30 years. She finds an account that earns 4.75% compounded monthly. How much does she need to deposit to reach her goal?