Simple Interest Formula I = PRT. I = PRT I = interest earned (amount of money the bank pays you) P = Principle amount invested or borrowed. R = Interest.

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Presentation transcript:

Simple Interest Formula I = PRT

I = PRT I = interest earned (amount of money the bank pays you) P = Principle amount invested or borrowed. R = Interest Rate usually given as a percent (must changed to decimal before plugging it into formula) T = Time ( in years)

EX1) A principle of $7,600 is invested at 3.5%, what is the total simple interest accumulated after 4 years. I = PRT I= I=$1,064 Interest paid by bank is unknown Principle (invested) Rate changed to decimal Time is 4 years Multiply 7, XX

An investment of $7,000 is invested at 7.5%, what is the total simple interest accumulated in the checking account after 3 years. I = PRT I= I= $1575 7, XX EX 2) When invested at an annual interest rate of 6% an account earned $ of simple interest in 2 years. How much money was originally invested in account? EX 3) I = PRT 360 = 360 = 0.12 P 360 ÷ ,000 = P P.062 XX X

Essential Question Explain the variables in the formula for simple interest?

Assignment Page Problems 1-8,10

Simple Interest Formula I = PRT

I = PRT I = __________________ (amount of money the bank pays you) P = _________ amount invested or borrowed. R = Interest _____ usually given as a percent (must changed to decimal before plugging it into formula) T = _____ ( in years)

EX1) A principle of $5,000 is invested at 4.5%, what is the total simple interest accumulated after 2 years. I = PRT I= I P R T M

An investment of $7,000 is invested at 7.5%, what is the total simple interest accumulated in the checking account after 3 years. EX 2) When invested at an annual interest rate of 6% an account earned $ of simple interest in 2 years. How much money was originally invested in account? EX 3)

Essential Question Explain the variables in the formula for simple interest?