12/13 Simple Interest Lesson

12/13 Simple Interest Lesson

by Samantha Ratliff

​Interest = Principal x Rate x Time

​(copy this down in your notes)

​Interest = Principal x Rate x Time

Example...1

• ​Principal: $200

• ​Rate: 3%

• ​Time: 5 years

Multiple Choice

Find the interest if the principal is $350, at 19% for 3 years.

• $199.50

• $19.50

• $19950

​Interest = Principal x Rate x Time

Example...2

• ​Principal: $1,000

• ​Rate: 8.3%

• ​Time: 18 months

​Interest = Principal x Rate x Time

Example...3

• You need a loan of $600 to fix the basement in your house. The bank loaned you the money at 10% interest for 2 years.

• ​How much do you pay in interest?

• ​What is the total amount you will have to pay back to the bank?

​Interest = Principal x Rate x Time

Remember principal is the starting amount for the LOAN

• You saved up some money for a new car that costs $32,000. You have $200 to put down (pay right now) but need a loan for the rest of the cost, $31,800. The car dealership offers you a deal of 0.17% interest for 5 years.

• ​How much will you pay in interest?

​

• ​What is the total amount you will end up paying for the car?

Multiple Choice

Find the amount of interest if the loan is $10,000 at at rate of 5.4% for 7 years.

• $3,780,000

• $378,000

• $3,780

• $37,800