Simple interest 2022

Front

What is simple interest?

Back

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

Front

What is the formula for calculating simple interest?

Back

The formula for calculating 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, and t is the time in years.

Front

If Marcus deposits $20,000 at a 4% simple interest rate for 5 years, how much interest will he earn?

Back

$4000.

Front

How do you calculate the total amount after interest is applied?

Back

Total Amount = Principal + Interest.

Front

If Violeta Orpilla invests $4000 at 5% simple interest for 12 years, what will be the total amount in the account?

Back

$6400.

Front

What is the principal in a simple interest calculation?

Back

The principal is the initial amount of money that is deposited or borrowed before interest is applied.

Front

What does the rate in simple interest represent?

Back

The rate represents the percentage of the principal that is paid as interest over a specific period, usually expressed annually.

Front

If Maria borrowed $3,000 at a 4% simple interest rate for 4 years, how much will she repay?

Back

$3480.

Front

What is the time period in simple interest calculations?

Back

The time period is the duration for which the money is borrowed or invested, usually measured in years.

Front

How do you find the interest earned on an investment?

Back

Interest earned can be found using the formula: I = P × r × t.