Simple Interest

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

Front

What is the formula for calculating Simple Interest?

Back

The formula for calculating Simple Interest is I = Prt.

Front

If Dan borrowed $2,000 for 6 months at 12% annual simple interest, how much interest does he owe?

Back

$120

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, 3.25% becomes 0.0325.

Front

What does 't' represent in the simple interest formula I = Prt?

Back

In the formula I = Prt, 't' represents the time in years.

Front

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

Back

$12

Front

What is the principal in the context of simple interest?

Back

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

Front

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

Back

Total Amount = Principal + Interest.

Front

If Caiden earned $475 from mowing lawns and deposited it at 3.8% simple interest, what will be his balance after 15 years?

Back

$270.75

Front

What is the annual interest rate in decimal form for 12%?

Back

0.12