1. example 2 Daily Versus Annual Compounding of Interest Chapter 5.5 a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. c.Graph the equations from parts (a) and (b) on the same axes with t between 0 and 30. d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually?  2009 PBLPathways

2. a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. c.Graph the equations from parts (a) and (b) on the same axes with t between 0 and 30. d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually?

3.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

4.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

5.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

6.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

7.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

8.  2009 PBLPathways a.Write the equation that gives the future value of $1000 invested for t years at 8% compounded annually. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

9.  2009 PBLPathways b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

10.  2009 PBLPathways b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

11.  2009 PBLPathways b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

12.  2009 PBLPathways b.Write the equation that gives the future value of $1000 invested for t years at 8% compounded daily. Future Value of an Investment with Periodic Compounding If $P is invested for t years at the annual interest rate r, where the interest is compounded k times per year, then the interest rate per period is, the number of compounding periods is kt, and the future value that results is given by

13.  2009 PBLPathways c.Graph the equations from parts (a) and (b) on the same axes with t between 0 and 30. Compounded annually Compounded daily

14.  2009 PBLPathways c.Graph the equations from parts (a) and (b) on the same axes with t between 0 and 30. Compounded annually Compounded daily t S

15.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S

16.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S

17.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S

18.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S

19.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S

20.  2009 PBLPathways Compounded annually Compounded daily d.What is the additional amount of interest earned in 30 years from compounding daily rather than annually? t S