Understanding Treasury Notes and Simple Interest

The video tutorial explains Treasury Notes (T-notes) as bonds issued by the federal government. It focuses on calculating simple interest using a $5000 T-note with a 3% annual interest rate over 4 years. The simple interest formula, I = p * r * t, is used to determine the interest earned, which amounts to $600. The tutorial provides a step-by-step breakdown of the calculation process, emphasizing the conversion of percentage to decimal and the multiplication steps involved.

What is the purpose of Treasury Notes issued by the federal government?

• To support local businesses

• To cover government expenses

• To provide loans to individuals

• To fund private companies

If you have a $5000 T-note with 3% annual interest, what is the maturity period mentioned in the problem?

• 3 years

• 4 years

• 2 years

• 5 years

In the simple interest formula I = p * r * t, what does 'p' represent?

• Principal amount

• Interest rate

• Interest earned

• Time period

How is the interest rate expressed in the simple interest formula?

• As a fraction

• As a decimal

• As a whole number

• As a percentage

What is the calculated interest earned on a $5000 T-note with 3% annual interest over 4 years?

• $300

• $450

• $600

• $750

Which of the following steps is correct in calculating the interest using the simple interest formula?

• Add principal, interest rate, and time

• Multiply principal by interest rate, then by time

• Multiply interest rate by time, then by principal

• Multiply principal by time, then by interest rate