FLASHCARD | Calculating Simple Interest

Front

What is the formula for calculating simple interest?

Back

I = P * r * t, where I is interest, P is principal, r is the rate of interest, and t is the time in years.

Front

What does 'P' represent in the simple interest formula?

Back

P represents the principal, which is the amount of money borrowed or deposited.

Front

What does 'r' represent in the simple interest formula?

Back

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

Front

What does 't' represent in the simple interest formula?

Back

t represents the time the money is borrowed or invested, measured in years.

Front

If you invest $500 at an interest rate of 5% for 2 years, how much interest will you earn?

Back

$50.

Front

If the principal is $1,000 and the interest earned is $100 over 4 years, what is the interest rate?

Back

The interest rate is 2.5%.

Front

What is the ending balance if you start with $1,000 and earn $200 in interest?

Back

The ending balance is $1,200.

Front

How much interest will you earn on $200 at 3% for 3 years?

Back

$18.

Front

What is the total amount after earning $30 interest on a principal of $300?

Back

$330.

Front

If you have a principal of $800 and earn $64 in interest over 2 years, what is the interest rate?

Back

The interest rate is 4%.