Chapter 4 Review Worksheet
Q.1 Invest $10,000 in an account that pays annual compound interest of 2.45%.
What will the balance of the account be after 1 year? 2 years? 3 years? 10 years?
How much interest will the account have earned after 1 year? 2 years
4.1
Saving a lump sum of Money
Compound Interest Formula:
r:
Quarterly interest rate, r =
t:
Number of compoundings
, Monthly interest rate, r =
, etc.
Annual Percentage Rate (APR) is the rate that will be compounded quarterly, monthly, etc.
Annual Percen
Chapter 5 Formulas:
5.1: Probability Theory
For equally likely outcomes, Probability =
If Probability
=
0 _
_
_
_
1 _
Probability of an event NOT occurring = 1 Probability of the event occurring
Theoretical probability is probability of an event that can