Simple Interest II

Simple Interest II

12/10/20

Multiple Choice

What is the simple interest formula?

• R = pit

• I = prt

• T = rpi

• P = irt

Remember what the variables stand for...

• I = interest

• p = principal

• r = rate (move the decimal point 2 spaces to the left)

• t = time (in years)

Kira took out a $9000 loan for 7 months and was charged simple interest. The total interest she paid on the loan was $336. What was the rate?

Fill the formula in w/ the important info...

$9000 loan for 7 months

interest she paid on the loan = $336

What is the rate?

• I = prt

• 336 = (9000)(r)(7/12)

• 336 = 5250r

• 0.064 = r Remember how we moved the decimal point to make this a decimal. This answer is asking a rate (aka a %). Move the decimal point 2 spots to the right now.

• 0.064 = 6.4% = r

Lisa took out a loan for 7 months and was charged simple interest at an annual rate of 7.2%. The total interest she paid on the loan was $231.00.

Fill the formula in w/ the important info...

7 months at a rate of 7.2%

interest she paid on the loan was $231.00

• I = prt

• 231 = (p)(.072)(7/12)

• 231 = p0.042

• $5,500 = p

Elsa took out a loan for $4800.00 and was charged simple interest at an annual rate of 11.5%. The total interest she paid on the loan was $138.00. How long was the loan for?

Multiple Choice

Fill the formula in w/ the important info...

loan for $4800.00

rate of 11.5%

interest she paid on the loan was $138.00

• I = (4800)(11.5)(138)

• 138 = (4800)(.115)(t)

• I = (4800)(11.5)(t)

• 138 = (4800)(11.5)(t)

Fill the formula in w/ the important info...

loan for $4800.00

rate of 11.5%

interest she paid on the loan was $138.00

• I = prt

• 138 = (4800)(.115)(t)

Multiple Choice

What does the next step look like?

• 138 = 552t

• 138 = 55200t

• 138t = 55200

• 138t = 552

Multiple Choice

Solve for t.

138 = 552t

• 25 = t

• 76,176 = t

• 0.25 = t

• 4 = t

Your equation should look like...

• I = prt

• 138 = (4800)(.115)(t)

• 138 =552t

• 0.25 = t

Now convert it to how we actually speak.

• 0.25 = t

• Convert it to days. 0.25 times 365 = 91.25 days

• Convert it to months. 0.25 times 12 = 3 months

• Convert it to years. 0.25 times 1 = 0.25 years