Simple Interest Practice

Front

What is Simple Interest?

Back

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

Front

How do you calculate Simple Interest?

Back

Simple Interest (I) is calculated using the formula: I = P * r * t, where P is the principal amount, r is the annual interest rate (in decimal), and t is the time in years.

Front

Convert 5% to decimal.

Back

0.05

Front

If you invest $200 at a 4% interest rate for 3 years, how much interest will you earn?

Back

$24

Front

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

Back

Principal amount (the initial amount of money invested or borrowed).

Front

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

Back

The annual interest rate, expressed as a decimal.

Front

What is the total amount after earning simple interest?

Back

Total Amount = Principal + Interest.

Front

If the principal is $500 and the interest earned is $30, what is the total amount?

Back

$530

Front

What is the time period in years if you have 24 months?

Back

2 years.

Front

If you borrow $1,000 at a 6% interest rate for 5 years, how much total will you pay back?

Back

$1,300.