# Ch6.3 - Maturity Value

FinanceSimple Interest

# Ch6.3 - Maturity Value

Created 2 years ago

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Slide Content
1. ### Slide 1 - Simple Interest – Lesson 3Maturity Value

• Rob Sorensen
2. ### Slide 2 - Maturity Value

• When a loan or investment reaches the end of its term, we say that it matures.
• The maturity value (also called the future value) is the total of both the original principal plus the interest due on the maturity date.
• We’ll use the letter S for maturity.
• Rob Sorensen
• 2
3. ### Slide 3 - Maturity Value Formula

• The basic formula for the maturity value is:
• We know that I=Prt, so we can re-write the formula as:
• We can then re-arrange terms as follows:
• Rob Sorensen
• 3
4. ### Slide 4 - Example – Maturity

• Find the future value (maturity) of a \$500 investment earning 4%p.a. for 146 days.
• Rob Sorensen
• 4
5. ### Slide 5 - Rob Sorensen

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• Try It Out!
• What will be the maturity value of \$2,500 invested at 4.25% p.a. from June 3, 2016 to August 16, 2016?