SIMPLE INTEREST

Front

What is Simple Interest?

Back

Simple Interest is the interest calculated on the principal amount only, without compounding. It is given by the formula: I = P * r * t, where I is interest, P is principal, r is rate (in decimal), and t is time (in years).

Front

What is the formula for calculating Simple Interest?

Back

The formula for calculating Simple Interest is I = P * r * t.

Front

If Ann puts $300 in a bank account earning 4% interest, how much will she earn in interest in 1 year?

Back

$12

Front

Before using the interest rate in the simple interest formula, you must convert it to a______?

Back

decimal

Front

What is the principal amount in the context of Simple Interest?

Back

The principal amount is the initial sum of money deposited or invested, before any interest is added.

Front

If the principal is $800, the interest rate is 3.5%, and the time is 2 years, what is the interest earned?

Back

$56

Front

What does the 'I' in the interest formula stand for?

Back

Interest

Front

How do you convert a percentage to a decimal?

Back

To convert a percentage to a decimal, divide the percentage by 100. For example, 4% becomes 0.04.

Front

If the starting money is $350, the interest rate is 2.5%, and the time is 3 years, how much interest is earned?

Back

$26.25

Front

What is the relationship between principal, interest rate, and time in Simple Interest?

Back

The interest earned is directly proportional to the principal amount, the interest rate, and the time period.