Simple Interest

Front

What is Simple Interest?

Back

Simple Interest is the interest calculated on the principal amount only, without compounding. It is given by the formula I = P * r * t, where I is the interest, P is the principal, r is the rate of interest per year, and t is the time in years.

Front

How do you convert months to years?

Back

To convert months to years, divide the number of months by 12.

Front

What is the formula for calculating Simple Interest?

Back

The formula for calculating Simple Interest is I = P * r * t.

Front

If Jenna borrowed $5,000 for 3 years and paid $1,350 in interest, what was her interest rate?

Back

Jenna's interest rate was 9%.

Front

How much total will Emilio have to pay back after borrowing $1200 at 8.5% interest for 2 years?

Back

Emilio will have to pay back a total of $1404.

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 meaning of 'Interest Rate'?

Back

The interest rate is the percentage of the principal charged as interest for a specific period, usually expressed annually.

Front

If the principal is $800, the interest rate is 3.5%, and the time is 6 months, how much interest is earned?

Back

The interest earned is $14.

Front

What is the difference between Simple Interest and Compound Interest?

Back

Simple Interest is calculated only on the principal, while Compound Interest is calculated on the principal plus any interest that has already been added.

Front

What is the total amount (A) after applying Simple Interest?

Back

The total amount A can be calculated using the formula A = P + I, where I is the Simple Interest.