Simple Interest

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What is Simple Interest?

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Simple Interest is the interest calculated on the principal amount only, without compounding. It is calculated using the formula: SI = P * r * t, where SI is the simple interest, P is the principal amount, r is the rate of interest per year, and t is the time in years.

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What is the formula for calculating Simple Interest?

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

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What does P stand for in the Simple Interest formula?

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P stands for Principal amount, which is the initial sum of money borrowed or invested.

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What does r represent in the Simple Interest formula?

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r represents the Rate of interest, expressed as a decimal.

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What does t represent in the Simple Interest formula?

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t represents the Time period for which the money is borrowed or invested, measured in years.

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If a student borrows $1000 at an interest rate of 8% for 2 years, what is the Simple Interest?

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The Simple Interest is $160.

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How do you convert a percentage to a decimal for the Simple Interest formula?

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To convert a percentage to a decimal, divide the percentage by 100. For example, 8% becomes 0.08.

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What is the total amount to be repaid if the principal is $1000, the interest rate is 8%, and the time is 2 years?

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The total amount to be repaid is $1160.

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If the principal amount is $3000, the interest rate is 5%, and the time period is 4 years, what is the total amount to be repaid?

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The total amount to be repaid is $3600.

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How much interest will Sara earn if she invests $5000 at an interest rate of 4% for 2 years?

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Sara will earn $400 in interest.