# Simple Interest 21.6 Vocabulary Principal = the original amount of money that is saved or borrowed. Simple interest = a fixed percent of the principal.

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Simple Interest 21.6

Vocabulary Principal = the original amount of money that is saved or borrowed. Simple interest = a fixed percent of the principal paid yearly.

Interest Formula (This formula is similar to d = rt) I = Interest P = Principal R = Interest rate per year T = Time, in years I = prt

Katrina puts \$500 in a savings account at a simple interest rate of 6% per year for two years. How much interest will she earn? I = prt I = \$500.06 2 I = \$60

Bill borrows \$500. He will repay it in 2 years at a simple interest rate of 8%. How much will he have to repay at the end of 2 years? I = prt I = \$500.08 2 I = \$80 \$80 + \$500 = \$580 Bill will have to repay \$580

Assignment - In Class Complete PW 21.6 –You may use a calculator Complete Ch. 21 Review (p. 414) –1-33 all –On lined paper –You may use a calculator

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