Simple Interest

Front

What is Simple Interest?

Back

Simple Interest is the interest calculated on the principal amount only, without compounding. It is calculated using the formula I = P * R * T.

Front

What does P stand for in the formula I = P·R·T?

Back

P stands for Principal, which is the initial amount of money invested or borrowed.

Front

What does R represent in the formula I = P·R·T?

Back

R represents the Rate of interest, expressed as a decimal.

Front

What does T represent in the formula I = P·R·T?

Back

T represents Time, typically measured in years.

Front

How do you convert a percentage to a decimal?

Back

To convert a percentage to a decimal, divide the percentage by 100.

Front

Convert 12% to a decimal.

Back

0.12

Front

Convert 5% to a decimal.

Back

0.05

Front

If you have $230 at 12% interest for 2 years, what is the simple interest?

Back

$55.20

Front

If the principal is $6,000, the interest rate is 5%, and the time is 6 months, what is the simple interest?

Back

$150

Front

How many years are in 9 months?

Back

0.75 years.