Simple Interest Practice

If the principal is $2,000, the interest rate is 4%, and the time is 5 years, what is the total interest earned?

• $200

• $300

• $400

• $500

What does the 't' in the simple interest formula I = P * r * t represent?

• The total amount of interest earned

• The time in years for which the money is borrowed or invested

• The rate of interest per year

• The principal amount of money invested

How do you convert a percentage to a decimal?

• Multiply the percentage by 100.

• Divide the percentage by 10.

• Divide the percentage by 100.

• Add 0.01 to the percentage.

What is the total amount to be paid back if you borrow $3,000 at a 6% simple interest rate for 4 years?

• $3,720

• $3,600

• $3,840

• $3,500

If you invest $1,000 at a 5% simple interest rate for 3 years, how much interest will you earn?

• $100

• $150

• $200

• $250

What does the 'P' in the simple interest formula I = P * r * t represent?

• The total amount of interest earned

• The Principal amount, which is the initial sum of money borrowed or invested.

• The rate of interest applied to the principal

• The time period for which the money is borrowed or invested.

How do you calculate the total amount after interest is added?

• Total Amount = Principal + Interest

• Total Amount = Principal - Interest

• Total Amount = Principal x Interest

• Total Amount = Principal / Interest

What is Simple Interest?

• Simple Interest is the interest calculated on the principal amount only, without compounding.

• Simple Interest is the interest calculated on the total amount including compounding.

• Simple Interest is the interest calculated on the principal amount and the interest accrued.

• Simple Interest is the interest calculated only on the interest accrued.

If you want to find the principal amount given the interest, rate, and time, which formula would you use?

• P = I / (r * t)

• P = I * (r + t)

• P = I * r * t

• P = I + (r * t)

What is the formula for calculating Simple Interest?

• I = P * r * t

• I = P + r + t

• I = P / (r * t)

• I = P * r - t