Compound and Continuous Interest Worksheet

Grade 11 Math worksheet covering compound interest and continuous compounding calculations.

Grade 11 Math Financial LiteracyCompound and Continuous Interest

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2 Short AnswerMultiple ChoiceFill in the BlanksTrue / False

Standards

CCSS.MATH.CONTENT.HSF.BF.A.1.ACCSS.MATH.CONTENT.HSF.IF.C.7.E

Topics

mathfinancial literacycompound interestcontinuous interestgrade 11

7 sections · Free to use · Printable

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Compound and Continuous Interest

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Read each question carefully and show all your work. Round your final answers to two decimal places where appropriate.

1. You invest $5,000 at an annual interest rate of 4% compounded quarterly. What will be the value of your investment after 5 years?

2. An initial deposit of $10,000 is made into an account that pays 6% annual interest, compounded monthly. How much interest will be earned after 10 years?

3. Which compounding frequency will yield the highest return for a given annual interest rate and investment period?

Annually

Semi-annually

Quarterly

Monthly

4. If you invest $2,500 at an annual interest rate of 3.5% compounded continuously, what will be the amount in the account after 7 years?

5. A sum of $15,000 is invested in an account that earns 5% interest compounded continuously. What is the effective annual interest rate?

6. The formula for compound interest is A = P(1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual interest rate, n is the number of per year, and t is the time in years.

7. For continuous compounding, the formula used is A = Pe^(rt), where 'e' represents constant.

8. Compounding more frequently always leads to a higher future value.

True

False