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Simple interest

Total questions: 14

Worksheet time: 4hrs 30mins

Name
Class
Date
1.

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

a)

fraction

b)

decimal

c)

ratio

d)

dollar amount

2.

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

a)

the amount of money

b)

the percent interest for his year

c)

the rate

d)

the percent proportion

3.

43.5% of this skeleton's body is his the mermaid tail. Write that percent as a decimal.

a)

4.35

b)

.435

c)

.0435

d)

4300

4.

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

a)

It

b)

Interest

c)

the Headless Iron Man

d)

Ignoramus

5.

This mysterious hand went to the mall and saw a massage chair that he would have to take a loan out to purchase. The total of the loan was $6600. The bank said that he could get a simple interest rate of 8% for 5 years. What is the total amount that the mysterious hand will pay for the chair?

a)

$2600

b)

$924

c)

$9240

d)

$260

6.

Alexton the Skeleton borrowed $4,000 for 5 years at 6% simple interest rate to pay for his band equipment. How much interest is that?

a)

$800

b)

$1,000

c)

$1,200

d)

$1,500

7.

Emilio borrows $1200 from a bank with 8% simple interest per year. How much will he have to pay back total in 2 years?

a)

$150

b)

$192

c)

$1350

d)

$1392

8.

Pennywise puts $300 in a bank account earning 4% interest. How much will he earn in interest in 1 year?

a)

4

b)

8

c)

12

d)

16

9.

Mr. Pham has $410,000 in a retirement account that earns 3.85% simple interest each year. Determine the amount earned each year by this investment.

a)

$15,785

b)

$157,850

c)

$425,785

10.
Monthly means how many times a year?
a)
b)
12
c)
52
d)
365
11.
5. Describe the difference between simple interest and compound interest?
a)
Simple Interest is applied yearly and compound interest is applied quarterly.
b)
Simple interest is less than 10% and Compound interest is above 10%.
c)
 Compound Interest is calculated only on the principal amount of a loan. Simple Interest is calculated on the principal amount and also on the accumulated interest of previous periods, and can thus be regarded as “interest on interest.”
d)
Simple Interest is calculated only on the principal amount of a loan. Compound Interest is calculated on the principal amount and also on the accumulated interest of previous periods, and can thus be regarded as “interest on interest.”
12.

Find the simple interest earned and the total amount in each case. Principal - $1000.00, Rate - 5%. Time - 5 Years.


What is the Interest Earned and what is the Total Amount Earned?

a)

Interest Earned $250.00 Total Amount Earned $1250.00

b)

Interest Earned $2000.00 Total Amount Earned $3000.00

c)

Interest Earned $2.50 Total Amount Earned $1002.50

d)

Interest Earned $20.00 Total Amount Earned $1020.00

13.
To earn as much interest as possible, you should open a savings account that earns ______ interest and has the _____ interest rate.
a)
compound; lowest
b)
simple ; lowest
c)
compound ; highest
d)
simple ; highest
14.

What is difference between simple interest and compound interest plans?

a)

Simple Interest pays higher interest rate.

b)

Compound interest pays interest on interest already earned.

c)

Interest earned in a simple interest plan cannot be taxed.

d)

There is no real difference between the two.