Simple Interest Learn to solve problems involving simple

Simple Interest Learn to solve problems involving simple interest. Course 2

Insert Lesson Simple Interest. Title Here Vocabulary interest simple interest principal Course 2

Simple Interest One type of interest, called simple interest, is money paid only on the principal. The principal is the amount of money deposited or borrowed. To solve problems involving simple interest, you can use the following formula. Rate of interest per year (as a decimal) Interest I=P·r·t Principal Course 2 Time in years that the money earns interest

Simple Interest Example 1: Using the Simple Interest Formula Find the missing value. I= , P = $575, r = 8%, t = 3 years I=P·r·t I = 575 · 0. 08 · 3 Substitute. Use 0. 08 for 8%. I = $138 Multiply. The simple interest is $138. 00. Course 2

Simple Interest Example 2: Using the Simple Interest Formula Find the missing value. I = $204, P = $1, 700, r = , t = 6 years I=P·r·t 204 = 1, 700 · r · 6 Substitute. 204 = 10, 200 r Multiply. 204 = 10, 200 r 10, 200 0. 02 = r The interest rate is 2% Course 2 Divide by 10, 200 to isolate the variable.

Simple Interest Example 3 Find the missing value. I= , P = $525, r = 7%, t = 2 years I=P·r·t I = 525 · 0. 07 · 2 Substitute. Use 0. 07 for 7%. I = $73. 50 Multiply. The simple interest is $73. 50. Course 2

Simple Interest Example 4 Find the missing value. I = $600, P = $2, 000, r = I=P·r·t 600 = 2, 000 · r · 3 Substitute. 600 = 6, 000 r Multiply. 600 = 6, 000 r 6, 000 6000 0. 1 = r The interest rate is 10% Course 2 , t = 3 years Divide by 6, 000 to isolate the variable.