Simple Interest

The simple interest formula is I=Prt. The P represents the principle. The principle is ___________________.

• the amount of money borrowed or deposited

• the percent interest for his year

• the amount taxed

The simple interest formula is I=PRT.

I is the interest earned or paid.

P is the principal.

R is the rate as a decimal.

What does the t represent?

• Principle

• Interest

• Time

• Percent Rate

Ann puts $300 in a bank account earning 4% (0.04) interest. How much will she earn in interest in 1 year?

• 4

• 8

• 12

• 16

Principal = $800

Interest Rate = 3.5% (0.035)

Time = 6 months

Find the interest earned.

• 14

• 140

• 168

• 16.80

Starting money = $350.

Interest rate = 2.5% (0.025)

TIme = 3 years.

How much interest?

• $7.50

• $26.25

• $87.5

• $262.50