Simply Tell the Total
Directions:
Use the simple interest formula to calculate the interest and the total amount to be repaid in one lump sum for the purchases below.
Simple Interest Rate Formula
I = P x R x T where:
I = interest
P = principal
R = interest rate (decimal number)
T = time (number of years)
| Description | Principal (P) | Interest Rate (R) | Time in Years (T) | Interest (I) | Total Amount to be Repaid |
| Cash loan | $100 | 40.0% | 1/2 year | $20 (100 x .4 x .5) | $120 ($100 + $20) |
| Big-screen TV | $700 | 7.0% | 2 years | ||
| College loan | $12,000 | 3.5% | 15 years |