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Jess wants to buy a car but she cannot decide if she should buy a Honda or a Kia. The Honda costs $16,000 and depreciates at an annual rate of 8%. The Kia costs $12,000 and depreciates at an annual rate of 12%. What will each car be worth in 5 years? In 10 years? Which car should she buy and why?
2. Ariana has a choice of two investments. She can invest $10,000 at 5% for 6 years or she can invest $9,000 at 6.5% for 7 years. Both accounts are compounded annually. Which investment will result in a greater amount of interest earned?
The compound interest and ‘e’ as a base.
Simple interest formula:
A = ending balance
P = Principal (or initial investment)
r = interest rate (in decimal form)
t = time (years)
Make an x-y table and
Input the following values
Using a calculator. What do you
Ray put $2,000 into a savings account. The interest on the account is 12% per year compounded quarterly. He wants to put the money away for 7 years. Using the compound interest method, how much will Ray have at the end of that time period?
In four years, Ben wants to have $5000 available to make a down payment on a new car. If the bank offers 4.25% interest compounded daily, how much should Ben invest in a savings account now so that he has the money for his car?
An amount of $2,340.00 is deposited in a bank paying an annual interest rate of 3.1%, compounded continuously. Find the balance after 3 years.