Simple Interest I =Prt I = Interest P = Principle r = rate t = time

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Presentation transcript:

Simple Interest I =Prt I = Interest P = Principle r = rate t = time The amount of money either being borrowed or saved r = rate A %, that will need to be converted into a decimal t = time The amount of time in years

The interest is $4500 15,000 • 0.06 • 5 P = 15,000 r = 6% t = 5 years What is the interest on a car loan for 5 years with a 6% interest rate when you borrow $15,000? P = 15,000 r = 6% t = 5 years 15,000 • 0.06 • 5 ……..0.06 The interest is $4500 At the end of the 5 years, how much did your car really end up costing you? Total cost = Principle + Interest T = P + I 15,000 + 4500 = $19,500 Your car really ended up costing you $19,500

The interest is $170 2500 • 0.017 • 4 P = 2,500 r = 1.7% t = 4 years You are going to the bank and depositing $2500. The bank is going to give you an interest rate of 1.7% You are going to leave your money in the account for 4 years P = 2,500 r = 1.7% t = 4 years 2500 • 0.017 • 4 ……..0.017 The interest is $170 At the end of the 4 years, how much money do you really have in your bank account? Total cost = Principle + Interest T = P + I 2500 + 170 = $2670 Your bank account now has $2670 in it.

The interest is $90 2,000 • 0.09 • 0.5 P = 2,000 r = 9% t = 6 months What is the interest on a loan for 6 months with a 9% interest rate when you borrow $2,000? P = 2,000 r = 9% t = 6 months 2,000 • 0.09 • 0.5 ……..0.09 ……..6/12 ……..0.5 The interest is $90 At the end of the 6 months, how much did your loan really end up costing you? Total cost = Principle + Interest T = P + I 2,000 + 90 = $2,090 Your loan really ended up costing you $2,090

The bank is going to loan you $25,000 for you to buy a new car The bank is going to loan you $25,000 for you to buy a new car. The loan will be for 5 years. What interest rate did they use if you end up paying $5,000 in interest? I = $5,000 P = 15,000 r = ? t = 5 years 5,000 = 25,000 • ? • 5 5,000 = 125,000 • ? 5,000/125,000 = ? ? = 0.04 The interest rate was 4%

Simple Interest I = P = r = t = The amount of ________ either being borrowed or saved r = A _____, that will need to be converted into a ____________ t = The amount of ________ in ________

The interest is $ P = r = t = What is the interest on a car loan for 5 years with a 6% interest rate when you borrow $15,000? P = r = t = The interest is $ At the end of the 5 years, how much did your car really end up costing you? Total cost = T = + ______ + _______ = $__________ Your car really ended up costing you $_______

The interest is $ P = r = t = T = ____ + _____ You are going to the bank and depositing $2500. The bank is going to give you an interest rate of 1.7% You are going to leave your money in the account for 4 years P = r = t = The interest is $ At the end of the 4 years, how much money do you really have in your bank account? Total cost = ___________ + ____________ T = ____ + _____ ________ + _______ = $_________ Your bank account now has $_________ in it.

The interest is $ P = r = t = What is the interest on a loan for 6 months with a 9% interest rate when you borrow $2,000? P = r = t = The interest is $ At the end of the 6 months, how much did your loan really end up costing you? Total cost = ___________ + __________ T = _____ + ____ ________ + _______ = $_________ Your loan really ended up costing you $______

The bank is going to loan you $25,000 for you to buy a new car The bank is going to loan you $25,000 for you to buy a new car. The loan will be for 5 years. What interest rate did they use if you end up paying $5,000 in interest? I = P = r = t = = • • = • / = ? ? = The interest rate was _____%