Simple Interest Solving for Variables

Jaliyah deposits $300 into an account that pays simple interest at a rate of 6% per year. How much interest will she be paid in the first 5 years?

Mathematical Equivalence

ON

If you bought a house for $120,000 at an interest rate of 4% and financed this loan with simple interest for 20 years, how much would the house end up costing you?

• $96,000

• $216,000

• $262934.78

• $142,934.78

What is the interest earned?

• $95

• $125

• $105

• $135

The simple interest formula is I=PRT.  What does the T represent?

• Principal

• Time, in hours

• Interest

• Time, in years

Which type of interest is only calculated on the original principal?

• Simple

• Compound

• Fixed

• Variable

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

• the amount of money borrowed or deposited

• the amount taxed

• the percent interest for this year

• the amount the bank owes you for being a customer at their bank

Dan borrows $1200 from a bank with 8% simple interest per year.  How much will he have to pay back IN TOTAL after 2 years?

• $150

• $1350

• $192

• $1392

How much interest will be earned for principal of $2,000 at and 8% rate for 5 years.

• $160

• $80,000

• $800

• $16

When Lisa was born, her parents put $8,000 into a college fund account that earned 9% simple interest. Find the amount of interest earned after 18 years.

• $720

• $1,080

• $20,960

• $12,960

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

• Fraction

• Decimal

• Ratio

• Dollar Amount