Finance Flashcards - Discrete Math

Simple Interest Formula

Compound Interest Formula

Savings Annuities Formula

Payout Annuities Formula

Loans

Compounding Defintion

The reinvestment of interest.

Payout Annuities

Assume that you take money from the account on a regular schedule (every month, year, quarter, etc) and let the rest sit there earning interest.

You deposit $200 in an account earning 3% interest compounded annually. How much will you have in the account in 20 years?

Compound Interest Problem

You deposit $5000 in an account earning 3% interest compounded monthly. How much will you have in the account in 15 years?

Compound Interest Problem

How much would you need to deposit in an account now in order to have $3000 in the account in 10 years? Assume the account earns 7% interest compounded monthly.

Compound Interest solve for Po

• Present Value

You deposit $400 each month into an account earning 3% interest compounded monthly.

Savings Annuities Formula

You deposit $5000 each year into an account earning 8% interest compounded annually. How much will you have in the account in 15 years?

Savings Annuities Problem

Suppose you want to have $700,000 for retirement in 25 years. Your account earns 5% interest.

Payout Annuities Problem

You want to be able to withdraw $25,000 each year for 25 years. Your account earns 9% interest.

Payout Annuities Problem

• Present value

You want to buy a $31,000 car. The company is offering a 5% interest rate for 60 months (5 years). What will your monthly payments be?

Loan Problem

You want to buy a $256,000 home. You plan to pay 5% as a down payment, and take out a 30 year loan for the rest.

Loan Problem

Don’t Know Norris

Total Money

Dream - Total Money

Total Interest