Simple Interest Concepts

Rearrange the formula to find T: T = @@\frac{I}{P \times R}@@.

• Find the Missing Values for Time.

• Calculate the Total Power.

• Determine the Resistance Value.

• Evaluate the Current.

P in the simple interest formula

• Principal amount (initial loan or investment)

• Percentage rate of interest

• Time period for the investment

• Total amount after interest

Always convert interest rates to decimals (e.g., 8% → 0.08).

• Quick Tips for Success: Interest Rates.

• Always use whole numbers for interest rates.

• Interest rates should be ignored in calculations.

• Convert interest rates to fractions.

What is charged or earned in Simple Interest?

• Money on a loan or investment

• A fixed fee for service

• A percentage of the principal amount

• An annual tax on savings

Simple Interest is the amount of money charged on a loan or earned on an investment over time.

What is the term for this concept?

• Simple Interest

• Compound Interest

• Loan Interest

• Investment Return

Compounding Frequency

• Compounding frequency has no effect on compound interest.

• Compounding frequency significantly affects the growth of compound interest.

• Compounding frequency only matters for short-term investments.

• Compounding frequency is irrelevant to interest calculations.

What is the principal amount in the example calculation?

• $3,000

• $4,000

• $5,000

• $6,000

The formula for Compound Interest is used to calculate the final amount after interest.

• A = Principal amount + Interest

• A = Final amount after interest.

• A = Interest rate x Time

• A = Total amount - Principal amount

Formula for Simple Interest

• I = P × R × T

• I = P + R + T

• I = P / (R × T)

• I = P - R - T

Step-by-step calculation for the rate (R) involves dividing 5,250 by 15,000 multiplied by 5.

• @@R = \frac{5,250}{75,000}@@

• @@R = \frac{5,250}{15,000}@@

• @@R = \frac{5,250}{5,000}@@

• @@R = \frac{5,250}{10,000}@@