Simple Interest

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What is Simple Interest?

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Simple Interest is a method of calculating the interest charge on a loan or financial investment. It is calculated using the formula: Interest = Principal × Rate × Time.

Tags

CCSS.7.RP.A.3

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What is the formula for calculating Simple Interest?

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The formula for Simple Interest is: I = P × r × t, where I is the interest, P is the principal amount, r is the rate of interest per year (in decimal), and t is the time in years.

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CCSS.8.EE.C.7B

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If Jane puts $875 in a bank with a 4% simple interest rate, how much interest will she earn in 7 years?

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$245

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CCSS.7.RP.A.3

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Ethan borrowed $2,190 at a simple interest rate of 2.5%. How much interest will he pay back in 3 years?

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$164.25

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CCSS.7.RP.A.3

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Colton borrowed $17,240 at an 8.25% simple interest rate. What will be the total amount he pays back after 5 years?

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$24,351.50

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CCSS.7.RP.A.3

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Stefan borrowed $8,950 for an engagement ring at a 6.85% simple interest rate. How much will he pay back after 6 years?

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$12,628.45

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CCSS.7.RP.A.3

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Veronica took a loan of $5,500 at a simple interest rate of 3.25% for 48 months. What is the total amount she will pay?

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$6,215.00

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CCSS.7.RP.A.3

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What does 'Principal' mean in the context of Simple Interest?

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Principal is the initial amount of money that is borrowed or invested, before interest.

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CCSS.7.RP.A.3

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What does 'Rate' refer to in Simple Interest calculations?

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Rate refers to the percentage of interest charged on the principal amount, usually expressed as an annual rate.

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CCSS.7.RP.A.3

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What does 'Time' represent in the Simple Interest formula?

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Time represents the duration for which the money is borrowed or invested, typically measured in years.

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CCSS.6.EE.B.7