Interest, Growth and Decay Flashcards
What is interest rate?
The percentage of the principal invested.
What is the principle?
The amount of money invested/capital/total sum.
What is compound interest?
When the interest paid grows but the interest rate stays the same.
What is Compound annually?
Compound interest yearly.
What is Return?
Money you gain by making an investment.
APR (Annual Percentage Rate)
The percentage of the money invested that is paid at the end of the year as interest
Depreciation/Negative interest.
Loss of value of a product
What is the quick way of working out annual compound interest?
Make percentage into decimal then add 1 to decimal and the multiply it the amount invested.
5% | 0.05 + 1 = 1.05 x amount invested
How to work out annual depreciation?
Divide the percentage by 100 then minus answer from 1 and then follow the growth method.
7%/100= 0.07 | 1-0.07=0.93 then multiply it by the time given.
What is the formula for percentage change?
Percentage change = actual change/old amount x100
Where does the old amount go when working out percentage change?
At the bottom of the fraction.
What is ‘actual change’ in percentage change formula?
The difference between the old amount and new amount.
Gross wage
Wage or salary before deductions
What is a quick way of working out 20% VAT
Double the figure and divide by 10.
What is the quick method of working out the VAT of 20% on a calculator?
The price multiplied by 1.2
1 is the original amount and and the 0.2 is 20% converted into a decimal.
