Simple interest

Front

What does the P stand for in the simple interest equation?

Back

Principal

Front

What is the formula for calculating simple interest?

Back

Simple Interest = Principal × Rate × Time

Front

If you deposit $1000 at a 5% interest rate for 3 years, how much interest will you earn?

Back

$150

Front

What is the meaning of 'Principal' in the context of simple interest?

Back

The initial amount of money deposited or borrowed before interest.

Front

If you earn $30 in interest from a principal of $600 over 2 years, what is the interest rate?

Back

2.5%.

Front

How does time affect the amount of simple interest earned?

Back

The longer the time period, the more interest is earned.

Front

If you borrow $2000 at an interest rate of 6% for 4 years, how much total interest will you pay?

Back

$480.

Front

What is the relationship between interest rate and simple interest earned?

Back

Higher interest rates result in more interest earned.

Front

If you want to find the principal amount from the interest earned, which formula would you use?

Back

Principal = Simple Interest / (Rate × Time)

Front

What happens to the total amount paid back if the interest rate increases?

Back

The total amount paid back increases.