7.04 Unit Test: Savings Accounts

Alice is using this formula to increase the distance she is running, in miles, each week: 2(1.1)^x. Compute the distance she will run in 52 weeks (one year). Does this distance seem reasonable, yes or no?

No

Use the passbook page to answer the question. Ken decided that he had enough saved if he combined it with the amount in his checking. He withdrew $500 in mid-April. What was his balance D?

$39.36

Growth curve A represents $200 saved at 2.5 percent simple interest. Growth curve B represents $200 saved at 2.5 percent interest, compounded quarterly. Use the graph shown to estimate the amount in Account B in 30 years.

$420

Nat put $550 in an account which pays four percent interest, compounded semiannually. How much will be in the account in three years?

$619

Using the equation y=10,000(0.97)^x, predict the purchasing power of $10,000 ten years later.

$7374

At the end of a 5-year term, what is the balance of an $8,000 investment at a simple interest rate of 1.8 percent? Round to the nearest dollar.

$8,720

Using the equation y=76(1.013)^x the table shown represents the population of the U.S. for each of the four years following 1900. Which year is incorrect? Years after 1900 x 1 2 3 4 U.S. Population (millions) y 77 78 80 80

3

Using the equation y=76(1.013)^x predict the population of the U.S. in the year 2010. Use x = 110 as this is 110 years after 1900. Round to the nearest year.

315 million

A savings account with compounded interest can be modeled by which type of graph?

Exponential

Does the following equation represent growth or decay? y=76(1.013)^x

Growth

Bill got a bank statement and found that his statement balance did not agree with his checkbook balance. He subtracted the outstanding checks to find the true balance and this still did not agree with his adjusted checkbook balance. What should he do?

Write the true balance in his checkbook

Patty deposited $650 in a savings account with two percent simple interest. If she keeps it in the account for one year, how much interest will she earn?

$13

Use the passbook to answer the question. What is his balance E after another deposit is made?

$144.36

Seth worked a summer job at a camp. His salary accumulated all summer and at the end of the summer he deposited $1890 in a savings account at 3.5 percent interest for 2.5 years. What was the total amount of money in the account at the end of this time?

$2055.38

Using the table, what is the amount in the account compounded quarterly after five years? Round to the nearest dollar. Account Type Principal Rate Time Simple Interest $8,000 1.8% 5 yr Compounded Semiannually $8,000 1.8% 5 yr Compounded Quarterly $8,000 1.8% 5 yr

$8752

What is the y-intercept of the equation y=76(1.013)^x?

76

The equation y=76(1.013)^x represents the the population of the United States, after 1900, in millions. What was the population in 1900, x = 0?

76 million

Jeremy had a starting balance of $122.00 in his savings passbook. He made these transactions: deposits of $68.52 and $46.35; withdrawals of $95.00 and $20.50; interest $1.50. What is his final balance?

$122.87

Use the graph shown to answer the question. Growth curve A represents $200 saved at 2.5 percent simple interest. Growth curve B represents $200 saved at 2.5 percent interest, compounded quarterly. What is the approximate difference between the two accounts in 20 years?

$25

Johnny deposited $1230 in a savings account at 2.25 percent interest. How much interest will the account earn in 10 years?

$276.75

Martha's grandfather put $2000 in a savings account for Martha's college fund when she was born. If the account pays three percent interest, compounded quarterly, how much will Martha have for college when she is 18?

$3425

Ray opened a savings account with $600 at 4.5 percent interest, compounded quarterly, and kept it in the account for two years. How much was the final amount? Round to the nearest dollar.

$656

At the end of a 5-year term, what is the balance of an $8,000 investment at a rate of 1.8 percent compounded semi-annually? Round to the nearest dollar.

$8,750

Is this statement true or false? Most banks just give you a warning if you write a check which you cannot cover in your checking account.

False

Mike has a choice of an account that compounds daily and an account that compounds monthly. If they both have the same interest rate, which will earn more interest?

The account that compounds daily

Which account earns more interest? $20,000 3% interest 4 y $20,000 1.5% interest 10 y

The account with 1.5% interest

Why do banks pay interest on savings accounts?

They invest the money

What will most banks do about a bounced check?

Return a bounced check and assess a charge to your account

Is this statement true or false? When you write a check, you write the amount to be paid in both numbers and words, for security purposes.

True

The graph represents the amount of money in a savings account that began with $1000. How much money is in the account after 15 years?

$1600

Kathy began with a balance of $96.54 in her checking account this month. She deposited $175.88 and wrote checks for $83.70, $56.15, and $93.42. How much will she have to deposit in order to pay her rent of $280.00?

$240.85

Will got an insurance check of $4500. He deposited it into a savings account at 1.7 percent interest for five years. What was the total amount of money in the account after five years?

$4882.50

Use the passbook page to answer the question. Ken Ritter was saving for a computer. What was his balance B after he made two deposits?

$536.96

Cherri filled out a deposit slip today. She deposited two checks for $56.13 and $22.10 and took out $20 in cash. What was her net deposit?

$58.23

What is the true balance? Check register balance $615.68 Bank statement balance $785.26 Outstanding checks $120.65 and $56.93 Service charge$8.00

$607.68

Matt had $325.64 in his account at the beginning of the month. He wrote checks for $114.23, $68.97, and $11.54. How much must he transfer from his savings to cover a rent check for $250?

$119.10

Your checkbook register shows these activities for the month: Old balance: $330.21 Check 279 to Clothes Couture for $31.85 Check 280 to Merrick Place Apartments for $250.00 Deposit $180.45 Check 281 to Gatt's Grocers for $41.74 Check 482 to Dr. Brian Seville for $35.00 What is your new checkbook balance?

$152.07

Growth curve A represents $200 saved at 2.5 percent simple interest. Growth curve B represents $200 saved at 2.5 percent interest, compounded quarterly. Use the graph shown to estimate the amount in Account A in 30 years.

$350

Check Register Balance $529.03 Bank Statement Balance $492.31 Outstanding Checks $14.67 and $24.56 Service Charges $75.95 What is the true balance of the checking account?

$453.08

What is the y-intercept of the equation y=10,000(0.97)^x?

10,000

The graph shown represents the running schedule of a distance runner, who is increasing the distance she runs each week. What is the distance she will run in the seventh week?

16 miles

Let y=10,000(0.97)^x represent the buying power of $10,000, with an inflation rate of three percent per year. The table shown represents the first four years after. Which year is incorrect? Years later x 1 2 3 4 Purchasing Power y 9,700 9,308 9,127 8,853

2

When the bank returns a check for which there is not enough money in the bank to cover it, what do we call the check?

Bounced

Use the graph shown to answer the question. Growth curve A represents $200 saved at 2.5 percent simple interest. Growth curve B represents $200 saved at 2.5 percent interest, compounded quarterly. Which savings account is growing fastest?

Compounded quarterly

Does the equation represent growth or decay? y=10,000(0.97)^x

Decay

Does the following equation represent growth or decay? y=4^x

Growth

A savings account with simple interest can be modeled by which type of graph?

Linear

Cherri filled out a deposit slip today. She deposited two checks for $56.13 and $22.10 and took out $20 in cash. Did Cherri have to sign the deposit slip, yes or no?

Yes

Carl put $450 in a savings account at 2.5 percent interest, compounded daily. How much money will he have in a year? Round to the nearest dollar.

$461

Use the graph shown to answer the question. Growth curve A represents $200 saved at 2.5 percent simple interest. Growth curve B represents $200 saved at 2.5 percent interest, compounded quarterly. Why is the amount much higher in the compounded interest account?

The account pays interest on both the principal and the interest accumulated