Simple Interest Practice

If you invest $1000 at a 5% interest rate for 3 years, how much interest will you earn?

• $100

• $150

• $200

• $250

What is the total amount to be paid back on a loan of $2000 at 10% interest after 5 years?

• $2500

• $3000

• $3500

• $4000

What does 'principal' mean in the context of simple interest?

• The total amount of money after interest is applied.

• The initial amount of money that is invested or borrowed before interest.

• The amount of interest earned on an investment.

• The fees charged by a lender for borrowing money.

If you have a loan of $5000 at an interest rate of 6% for 4 years, what is the total interest paid?

• $800

• $1000

• $1200

• $1400

How do you find the time in years if you know the interest, principal, and rate?

• @@t = rac{I}{p imes r}@@

• @@t = rac{p imes r}{I}@@

• @@t = I imes p imes r@@

• @@t = rac{I imes r}{p}@@

What is the term for the percentage charged on a loan or paid on an investment?

• Principal

• Interest rate

• Dividend

• Yield

If a bank offers 4% interest compounded annually, how much interest will you earn on $1000 after 3 years?

• $124.86

• $120.00

• $130.00

• $140.00

What is the formula to calculate the total amount after interest is applied?

• Total Amount = Principal + Interest = @@A = p + I = p + (p \times r \times t)@@

• Total Amount = Principal - Interest = @@A = p - I@@

• Total Amount = Principal + Interest = @@A = p + (p \div r \div t)@@

• Total Amount = Principal + Interest = @@A = p + (p \times r \div t)@@

What is the meaning of 'interest' in finance?

• The amount paid to a bank for holding your money.

• The cost of borrowing money or the return on investment for saving money.

• A fee charged for using a credit card.

• The total value of assets owned by an individual.

What is the formula for Simple Interest?

• @@I = p \times r \times t@@

• @@I = p + r + t@@

• @@I = \frac{p}{r \times t}@@

• @@I = p - r - t@@