Savings bonds

Savings bonds are usually sold by the United States government

This type of bonds can be purchased with a face value ranging from 50 to 10,000.

The cost of these bonds is 50% of the face value

In order to find out how much interest you will earn, you need to know the redemption value, or the value of the bond when it is redeemed.

A chart similar to the one below can be used when computing the redemption value

Say for instance, you buy a 1000 dollars bond and redeemed it 4 years later. What is the redemption value of the bond? How much interest did you earn?

You can compute the redemption value as the following:

The redemption value is 1204.2

You can compute the interest as the following:

The interest is 204.2

Savings bonds

Consumer math

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