Transcription of Functions - Compound Interest
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Functions - Compound Interest
- Compound InterestObjective: Calculate final account balances using the formulas for com-pound and continuous application of exponential Functions is Compound Interest . When money isinvested in an account (or given out on loan) a certain amountis added to thebalance. This money added to the balance is called that Interest isadded to the balance, it will earn more Interest during the next compoundingperiod. This idea of earning Interest on Interest is called Compound Interest . Forexample, if you investS100 at 10% Interest compounded annually, after one yearyou will earnS10 in Interest , giving you a new balance ofS110. The next yearyou will earn another 10% orS11, giving you a new balance ofS121.
10.6 Practice - Compound Interest Solve 1) Find each of the following: a. S500 invested at 4% compounded annually for 10 years. b. S600 invested at …
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