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Investment

We estimate MS1-12-IV is worth about 9 marks out of 100 under the new Mathematics Standard 1 syllabus. Practise 11 exam-style questions (multiple choice, numerical answer, multi-part, short answer) with instant marking and a worked solution for every question.

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Topic notes

Simple interest with I = Prn, compound interest with FV = PV(1 + r)^n including present value and finding the rate, compounding periods, comparing simple and compound growth, spreadsheets, and comparing savings accounts, shares and property.

  1. 1What you need to know
  2. 2Simple interest
  3. 3Compound interest
  4. 4Comparing simple and compound interest
  5. 5Modelling with a spreadsheet
  6. 6Investment strategies
  7. 7Common mistakes
  8. 8Exam tips
  9. 9Links to other topics
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Example questions

Example 1 · 1 mark · multiple choice

Ella invests $4500 at 3.2% p.a. simple interest for 30 months. How much interest does she earn?

  1. A$360.00
  2. B$4320.00
  3. C$144.00
  4. D$4860.00

Example 2 · 1 mark · multiple choice

$8000 is invested at 4.8% p.a., compounded monthly, for 3 years. What is the future value?

  1. A$8096.38
  2. B$9208.18
  3. C$9236.42
  4. D$9152.00

Example 3 · 2 marks · numerical answer

$5000 was invested with interest compounded annually. After 4 years the investment was worth $6077.53. Find the annual interest rate, as a percentage correct to 1 decimal place.

Answers and worked solutions appear when you practise these questions.

Other Mathematics Standard 1 topics