Simple Interest

Choose the correct word for the definition: The amount of money deposited or borrowed.

• Rate

• Interest

• Time in years

• Principal

When using the Simple Interest formula, you must express the time (t) in _________.

The interest rate is expressed as a percentage. But when you use the Simple Interest formula you must write the percentage rate as a ___________.

• whole number.

• decimal.

• as a negative number.

• without zeros.

Write the percent as a decimal: 3.45%

• 0.0345

• 0.345

• 0.00345

• 34.5

What is the simple interest formula?

• A = P + I

• P = rit

• I = Prt

• R = tip

You deposit $4,500 in an account that earns 2.25% simple interest. If you leave the money in the account for 8 years, how much interest would you earn?

• 8100

• 8.10

• 81

• 810

Ben borrows $15,000 to buy a car at a simple interest rate of 5.75%. If the loan is for 7 years, how much interest will Ben pay? How much total will Ben have to pay?

• $6,037.50, $21,037.50

• $637.05, $15,637.05

• $6,037.50, $8,962.50

• $60,375.00, $75,375

How many years will it take to earn $255 of interest if you put $1,700 in a savings account that earns 3% simple interest?

• 2 years

• 3 years

• 4 years

• 5 years

Beth borrows $5000 to build a deck. If she pays $200 of interest and the loan was for 1 year, what was the interest rate (as a percent) on the loan?

• .04%

• 4%

• .4%

• 40%

Choose the correct vocabulary word for the definition: The amount earned or paid for the use of money.

• Principal

• Interest

• Rate

• Balance