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Simple Interest

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  • What is the formula to calculate simple interest?
    I=P * R * T
  • What is the formula to calculate principal amount?
    P=I/(rt)
  • David borrowed 85,000 to purchase a car, with a loan term of three years at an interest raete of 12%. What is the interest amount?
    30,600
  • the amount earned from investing or borrowing
    principal
    interest
    rate
  • Interest is the amount it will cost you to borrow money. TRUE OR FALSE
    True
    False
  • P = Principal (amount borrowed). TRUE OR FALSE
    True
    False
  • T = Time, usually calculated as the number of years. TRUE OR FALSE
    True
    False
  • Your interest rate is affected by your credit score. TRUE OR FALSE
    False
    True
  • Ella decided to invest in a bank. How much will she earn if she invested 15,000 for an interest rate of 10% in one year?
    1,500
  • R = Rate of Interest in %. TRUE OR FALSE
    False
    True
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