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Simple Interest Calculator - Calculate Interest and Balance

Easily calculate the interest earned and total balance for savings or investments using the simple interest formula. Find interest rates, principal amounts, and time required in just a few clicks.

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Simple Interest Calculator - Calculate Interest and Balance

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  1. Vocabulary • interest: money paid or earned for the use of money • simple interest: money earned on savings account or investment. It can also be money you pay for borrowing money. It is money paid or earned only on the principal. • principal: the starting amount/ the amount of money borrowed or deposited. • rate: what percent interest is charged

  2. Simple Interest Formula I = Prt Simple Interest = Principal x Rate x Time Write as a decimal. in years

  3. To find total balance Principal + Interest

  4. Finding interest earned and balance

  5. Example 1 Rebecca put $600 in a savings account. The account earns 3% simple interest per year. What is the interest rate earned after 3 years? I = Prt I = (600) (0.03) (3) I = $54.00

  6. Example 1 Rebecca put $600 in a savings account. The account earns 3% simple interest per year. What is the balance after 3 years? Principal + Interest 600 + 54 $654.00 Rebecca’s savings account has $654.00 in it after 3 years.

  7. To convert Months into years months 12

  8. Example 2 Blake invests $5,000 in bonds for 6 months at an annual interest rate of 7%. How much interest did he earn, and what is the balance in his account? I = Prt 6 12 I = (5,000) (0.5) (0.07) 6 months = 0.5 year I = $175.00

  9. Example 2 What is the balance in his account after 6 months? Principal + Interest 5,000 + 175 $5,175.00 Blake’s account has $5,175.00 in it after 6 months.

  10. Finding annual interest rate

  11. Example 3 You put $1,000 in an account. The account earns $80 simple interest in 4 years. What is the annual interest rate? I = Prt 80 = (1,000) (r) (4) Simplify. 80 = 4,000r Divide both sides by 4,000. 0.02 = r 2%

  12. Finding time

  13. Example 4 How long will Karlie have to leave $5,000 in the bank to earn $500 in simple interest at 2%. I = Prt 500 = (5,000) (0.02) (t) Simplify. 500 = 100t Divide both sides by 100. 5 years 5 = t

  14. Finding the Principal

  15. Example 5 How much money did Carol borrow from the bank if she owed $45.00 in interest after 10 years with an annual interest rate of 3.5%. I = PRT 45 = (P) (0.035) (10) Simplify. 45 = 0.35P Divide both sides by 0.35. $128.57 = P

  16. Let’s practice • Directions: Find the interest earned AND balance of the account. • $600 at 6% for 3 years • $5,300 at 7.45% for 54 months

  17. Answers • Directions: Find the interest earned AND balance of the account. • $600 at 6% for 3 years • $108.00; $708.00 • 2) $5,300 at 7.45% for 54 months • $1,776.83; $7,076.83

  18. Thank you for purchasing my simple interest product! I hope you enjoy my product! fonts by: http://www.kevinandamanda.com Frames by: Mad Clips Factory

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