- Home
- Math 30-2 (Alberta)
- Applications of Exponential and Logarithmic Functions
Finance: Compound interest
- Lesson: 1a4:34
- Lesson: 1b3:06
- Lesson: 1c3:50
- Lesson: 1d3:23
- Lesson: 1e3:21
- Lesson: 26:41
Finance: Compound interest
Now that we understand the concepts behind exponential growth and decay, let's utilize them and solve real-life problems! One of the many areas where exponential growth comes in handy is Finance. In this section, we will learn how compound interest helps us grow our deposits in our investment and/or bank accounts.
Related Concepts: Derivative of inverse trigonometric functions, Derivative of logarithmic functions
Lessons
exponential growth/decay: Af=Ai(1+nr)nt
Af: final amount
Ai: initial amount
r : Annual interest rate
t: total time given in years
n : number of times compounded in a year, if
Af: final amount
Ai: initial amount
r : Annual interest rate
t: total time given in years
n : number of times compounded in a year, if
Compound daily: |
n = 365 |
Compound monthly: |
n = 12 |
Compound quarterly: |
n = 4 |
Compound semi-annually: |
n = 2 |
Compound annually: |
n = 1 |
- 1.Bianca deposits $1,000 in a savings account with an annual interest rate of
12%. How much money will she have in 20 years, if the interest is compounded:a)dailyb)monthlyc)quarterlyd)semi-annuallye)annually - 2.A $1000 investment, compounded quarterly, doubles in value over a period
of 8 years. Find the interest rate per annum.
Do better in math today
6.
Applications of Exponential and Logarithmic Functions
6.1
Exponential growth and decay by a factor
6.2
Exponential decay: Half-life
6.3
Exponential growth and decay by percentage
6.4
Finance: Compound interest
6.5
Continuous growth and decay
6.6
Logarithmic scale: Richter scale (earthquake)
6.7
Logarithmic scale: pH scale
6.8
Logarithmic scale: dB scale
6.9
Finance: Future value and present value
Don't just watch, practice makes perfect
Finance: Compound interest
Don't just watch, practice makes perfect.
We have plenty of practice questions in Math 30-2 (Alberta) for you to master.
Get Started NowPractice topics for Applications of Exponential and Logarithmic Functions
6.1
Exponential growth and decay by a factor
6.2
Exponential decay: Half-life
6.3
Exponential growth and decay by percentage
6.4
Finance: Compound interest
6.5
Continuous growth and decay
6.6
Logarithmic scale: Richter scale (earthquake)
6.7
Logarithmic scale: pH scale
6.8
Logarithmic scale: dB scale
6.9
Finance: Future value and present value