Download PSSA 1.8 Percent and Simple Interest PSSA PREP

PSSA PREP
PSSA 1.8 Percent and Simple Interest
Percent means per one hundred.
percent =
part
whole
Ex 1
You buy a sweater that was originally priced at $49.00 and it is discounted 20%. How much will you save?
What is the new price of the sweater?
Ex 2
A new car that sells for $25,600 is discounted 10%. What is the savings? What is the discounted price of the
car?
Ex 3
A new car has a discounted price of $23,500. The salesman tells you that the price has already been reduced
by 15%. What was the original price of the car?
Ex 4
On a math test Tom answered 18 out of 20 questions correctly. What was his percentage correct?
PSSA PREP
Ex 5
The cost of a school lunch went up from $1.60 to $1.85. What was the percent of increase in the cost of a
school lunch?
Ex 6
School enrollment declined from 1528 to 1436. What was the percent decrease?
Ex 7
In Chicago the sales tax on clothing is 8%. In Philadelphia there is no sales tax on clothing. How much more
would you pay at a store in Chicago for a sweater that costs $79.99?
Ex 8
The price of gas went up by 16% last month. It now costs $2.39 for a gallon of gas. What was the cost of gas
last month?
Ex 9
If a price is tripled it is increased by _____%
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Simple Interest
I = prt
I = interest earned
p = principal (original value)
r = interest rate
t = time in years
Ex 1
Use the simple interest formula to determine the amount of interest earned over 5 years for a savings account
containing $2,600 if the interest rate is 1.5%.
What is the amount of interest for the same account if the interest rate is 2.25% ?
Ex 2
What interest rate would be required to increase a principal value of $300 to $400 over 10 years?
Ex 3
Your bank charges you 7% simple interest per year for your car loan. How much interest will you pay for
your $20,000 car loan for the first year?
PSSA PREP
Ex 4
One bank pays 1.25% simple interest per year on a 2 year CD while another bank pays 1.75% interest per year
on a 2 year CD. How much more would you earn at the second bank on a deposit of $1000 for 2 years?
Compound Interest
With compound interest, your interest earned is added to your principal and as time goes on,
you earn interest on the interest.
r⎞
⎛
A = p⎜1 + ⎟
⎝ n⎠
nt
A = total amount of money in the account
p = principal
r = interest rate
t = time in years
n = number of compounding periods per year
(compounded quarterly, n = 4; compounded monthly, n = 12
compounded semi-annually, n = 4 etc.)
Ex 5
Randy deposited $3,400 in a bank account earning 4.25% interest compounded quarterly. How money will
Randy have in his account after 10 years?
Ex 6
Ellen deposited her inheritance, $56,000 in a bank account earning 4.85% interest compounded monthly.
How much money will she have in her account after 5 years?
Homework: p. 20-21 (1-7, 10, 12, 13, 15-19)