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Ch. 5-8 Simple Interest

Ch. 5-8 Simple Interest. Ch. 5-8. Vocabulary Interest (I) : the amount of money paid or earned for the use of money. (For example, you earn interest from your saving account, but you pay interest for your credit card when you have overdue balance.)

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Ch. 5-8 Simple Interest

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  1. Ch. 5-8 Simple Interest

  2. Ch. 5-8 Vocabulary • Interest (I): the amount of money paid or earned for the use of money. (For example, you earn interest from your saving account, but you pay interest for your credit card when you have overdue balance.) • Principal (P): the amount of money invested or borrowed. • Rate (R): the percent of interest you will get. • Time (T):how many years you will deposit or borrow the money.

  3. Finding simple interest: I = prt I = interest, p = principal, r = rate t = time Annie deposit $500 at a rate of 6.25% for 3 years. Find the simple interest. I = prt I = $500 x 0.0625 x 3 I = $31.25 x 3 I = $93.75 The simple interest is $93.75 Ch. 5-8 Simple Interest

  4. Finding simple interest: I = prt I = interest, p = principal, r = rate t = time $200 at 7.5% for 4 years. Find the simple interest. I = $200 x 0.075 x 4 I = $15 x 4 I = $60 The simple interest is $60 What is the total amount? =$200+$60 = $260 Ch. 5-8 Simple Interest

  5. Find the total amount: Total amount = p + I Find the total amount of money in an account where $95 is invested at 7.5% for 8 months. *one year has 12 months, 8 months is 8/12 = 2/3 year I = prt I = $95 x 0.075 x 2/3 I = $4.75 The total amount: = p + I = $95 + $4.75 = $99.75 The total amount is $99.75 Ch. 5-8 Simple Interest

  6. Find the total amount: Total amount = p + I Find the total amount of money in an account where $200 is invested at 8.5% for 9 months. *one year has 12 months, 9 months is 9/12 = 3/4 year I = prt I = $200 x 0.085 x 3/4 I = $12.75 The total amount: = p + I = $200 + $12.75 = $212.75 The total amount is $212.75 Ch. 5-8 Simple Interest

  7. Ch. 5-8 Simple Interest Find the Simple Interest:I = prt Booker earned $1200 over the summer. He invested (invertido) the money in stocks. To his surprise, the stocks increased in value to $1,335 in only 9 months. Find the simple interest rate for the investment. I = $1335 - $1200 = $135 p = $1200 t = 9/12 = 3/4

  8. I = prt 135 = 1200 x r x ¾ 135 = 900r 135 = 900r 900 900 r = 0.15 (15%) The interest rate is 15%

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