Simple Interest

Front

What is Simple Interest?

Back

Simple Interest is the interest calculated on the principal amount, or the original amount of money borrowed or invested, over a specific period of time.

Front

What is the formula for calculating Simple Interest?

Back

The formula for Simple Interest is: SI = P * r * t, where SI is the simple interest, P is the principal amount, r is the rate of interest (in decimal), and t is the time (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. For example, 7.25% becomes 0.0725.

Front

If the interest rate is 4.8%, what is it in decimal form?

Back

0.048

Front

How do you find the time in years if given time in months?

Back

To find the time in years, divide the number of months by 12.

Front

If you borrow $43,800 at a 4.8% interest rate for 2 years, how much interest will you pay?

Back

$4204.80

Front

What is the total amount to be paid back if you borrow $1200 at 8% simple interest for 2 years?

Back

$1392

Front

What does 'principal' mean in the context of Simple Interest?

Back

Principal is the initial amount of money borrowed or invested before interest.

Front

What is the relationship between time and interest in Simple Interest?

Back

The longer the time period, the more interest will accumulate on the principal amount.

Front

What happens to the Simple Interest if the principal amount is doubled?

Back

If the principal amount is doubled, the Simple Interest will also double, assuming the rate and time remain constant.