Simple Interest Study Guide

This is the word used to describe the amount of a loan

• Interest

• Principal

• Rate

• Time

Tags

CCSS.7.RP.A.3

This is the word used to describe the extra money you are charged for taking out a loan

• Interest

• Principal

• Rate

• Time

Tags

CCSS.7.RP.A.3

How many years is 31 months?

• 2.58 years

• 8.4 years

• 3.41 years

Answer explanation

To turn months into years take the number months and divide it by 12.

31/12 = 2.58 years

Tags

CCSS.5.MD.A.1

How many years is 743 days?

• 1.89

• 2.04

• 61.92

• 1.43

Answer explanation

743/365 = 2.04 years

Tags

CCSS.4.MD.A.1

Select the equation you use to calculate Interest

• MV = P + I

• P = I * R * T

• I = P * R * T

• I = P * T

Answer explanation

Interest = Principal * Rate * Time

Tags

CCSS.7.RP.A.3

The Maturity Value of a loan is calculated by adding the principal and ___________ together

• Rate

• Time

• Principal

• Interest

Answer explanation

Maturity Value = Principal + Interest

Tags

CCSS.7.RP.A.3

Donald duck borrowed $123 dollars from Mickey Mouse borrowed him the money for 3 years and charged him $18 in interest. What is the principal of the loan?

• $123

• 3 years

• 3.5%

Answer explanation

Remember principal is the amount of the loan

Tags

CCSS.7.RP.A.3

The equation for maturity value is

• MV = T + I

• MV = P + T

• MV = P + PRT

• MV = P * I

Answer explanation

Maturity Value = Principal + Interest

Tags

CCSS.7.RP.A.3

Find the interest on a loan of $4,325 that was given for 36 months at an interest rate of 5.25%.

• $6,811.88

• $68,118.75

• $68.12

• $681.19

Answer explanation

Interest = P * R * T

Interest = $4,325 * .0525 * 3

Interest = $681.19

Tags

CCSS.7.RP.A.3

Calculate the interest on a simple interest loan of $124,985. The loan was given for 3.5 years at a rate of 4.25%.

• $1,859,151.88

• $185,915.19

• $18,591.52

Answer explanation

I = P * R * T

I = $124,985 * .0425 * 3.5

I = $18,591.52

Tags

CCSS.7.RP.A.3