These videos are examples of compound interest type questions – now called ‘growth and decay.'
- George invested £3200 in a savings account for 3 years. He was paid compound interest at a rate of 3.5% per annum. Work out how much was in the account after 3 years?
- Tony invested £4500 for 3 years. He was paid 4% per annum compound interest. Calculate the total amount of interestTony will get after 3 years.
- Jayden invested £2400 for n years in a savings account. He was paid 7.5% per annum compound interest. At the end of n years he had £3445.51 in the savings account. Work out the value of n.
- Daljit bought a new campervan that had a value of £36,000. Each year the value of the campervan will depreciate by 22%. Work out the value of the campervan after 4 years.
- Josh bought a new car for £16500. In the first year the value of the car depreciates by 25%. In the second year and the third year the car depreciates by 12% Work out the value of the car after three years.
- Carys is going to invest some money for 5 years. She can choose from two options – one with compound interest and the other with simple interest. Which investment should Carys choose?
You can download a copy of the questions here.
…. and here are the answers.
The questions are aimed at around grade 5, and the topic appears in all the main examination boards, including Edexcel, AQA and OCR. Compound interest, or growth and decay, questions are fairly popular as they are considered ‘real maths.'
The main thing to remember is that it's important to always write the formula at the top of your answer sheet:
Total = original x multiplier^n
Please do stop the video, try the question and compare your solution.
I hope the videos help and please leave a comment below, if you are not sure. Alternately you can view my YouTube channel and leave a comment there – I'll always try to respond as quickly as possible.
Watch the videos on YouTube:
Here's an additional (although older) post on compound interest: