This quiz works best with JavaScript enabled. Home > Unit V Mathematical Reasoning And Aptitude > Compound Interest – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Compound Interest Quiz 1 (10 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The process of converting the initial amount into future value is called discounting. A) False. B) True. C) Not clear. D) None of above. Show Answer Correct Answer: A) False. 2. Which is better to have when you invest money? A) Compound Interest. B) Simple Interest. C) Good interest. D) Simpound Interest. Show Answer Correct Answer: A) Compound Interest. 3. Earning interest on interest is called A) Extra Interest. B) Simple Interest. C) Inflation Interest. D) Compound Interest. Show Answer Correct Answer: D) Compound Interest. 4. Jenny invests $ 7,530 in a savings account with a fixed annual interest rate compounded continuously. After 8 years, the balance reaches $ 12,169.04. What is the interest rate of the account? A) 4%. B) 5%. C) 6%. D) 7%. Show Answer Correct Answer: C) 6%. 5. Compound interest consists of both simple interest and interest on interest. A) True. B) False. C) No answer. D) None of above. Show Answer Correct Answer: A) True. 6. Derrick has $ 1,000 in a savings account that ears 15% interest, compounded monthly. To the nearest cent, how much will he have in 2 years? (Use the formula on the screen. There are 12 months in a year.) A) $ 5,350.25. B) $ 1,322.50. C) $ 1,025.16. D) $ 1,347.35. Show Answer Correct Answer: D) $ 1,347.35. 7. In case of future value with a given interest factor A) Discounting will take place. B) Compounding will take place. C) Annuity factor will be considered. D) All of these. Show Answer Correct Answer: B) Compounding will take place. 8. Karla invested $ 1,000 in savings bonds. If the bonds earn 6.75% interest compounded semi-annually, how much total will Karla earn in 15 years? A) $ 1,584.62. B) $ 2,651.39. C) $ 2,706.86. D) $ 1,825.10. Show Answer Correct Answer: C) $ 2,706.86. 9. You invest $ 3000 for compounded annually for three years with an annual interest rate of 5%. How much do you have at the end of three years? A) $ 3472.50. B) $ 3152.75. C) $ 3450.25. D) $ 3600.00. Show Answer Correct Answer: A) $ 3472.50. 10. The interest from the previous year also earns interest, which of the following describes the statement? A) Simple. B) Rate. C) Compound. D) Time. Show Answer Correct Answer: C) Compound. Next →Related QuizzesCompound Interest Quiz 2Compound Interest Quiz 3Compound Interest Quiz 4Compound Interest Quiz 5Compound Interest Quiz 6Compound Interest Quiz 7Compound Interest Quiz 8Compound Interest Quiz 9Compound Interest Quiz 10Compound Interest Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books