Simple Interest

The simple interest formula is I=Prt.  What does the t represent?

• Principle
• Interest
• Time, in hours
• Time, in years

What does the "I" in the interest formula stand for?

• Principal
• Interest
• Rate
• Time

What does the "p" in the interest formula stand for?

• Principal
• Interest
• rate
• time

What does the "r" in the interest formula stand for?

• Principal
• Interest
• rate
• time

The rate is given as a percent (%).  Before using it in the simple interest formula, you must first convert it to a______.

• fraction
• decimal
• ratio
• dollar amount

Tina invested $2,000 in a simple interest account and earned 8% rate for 5 years. What is the interest that she earned on the account?

• $160

• $800

• $80,000

• $16

Emilio borrows $1200 from a bank with 8.5% simple interest per year. How much will he have to pay back total in 2 years?

• $204

• $996

• $1,020

• $1,404

Principal = $500
Interest rate =5%
Time = 5 years
What is the interest earned?

• 95
• 105
• 125
• 135

Jenna borrowed $5,000 for 3 years and had to pay $1,350 simple interest at the end of that time. What rate of interest did she pay?

• 6%
• 6%
• 8%
• 9%

Jerry borrowed $4,000 for 5 years at 6% simple interest rate. How much interest is that?

• $800
• $1,000
• $1,200
• $1,500