How to Calculate Simple Interest in Financial Mathematics

The video tutorial explains simple interest, a concept used in financial mathematics to calculate interest over time at a specific rate. It covers the formula for simple interest, provides examples of calculating interest and total amounts, and demonstrates how to find the interest rate and time period using the formula. The tutorial emphasizes understanding and manipulating the formula to solve different types of problems.

Explain the importance of distinguishing between finding interest and total amount in simple interest calculations.

How do you find the simple interest rate if you know the interest earned, principal, and time?

If £45,000 receives £19,800 in simple interest at a rate of 5.5% per annum, how many years will it take?