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Sean's new car loan statement said he would pay $4,866.25 in interest from an interest rate of 8.5% over 5 years. How much did he borrow to buy his new car?

$11,450

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In 5 years, Gloria's bank account earned $2,400 interest at 5%. How much had she deposited in the account?

$9,600

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In the simple interest    formula, the rate of interest is given as an annual rate, the rate for one year. So the units of time must be in years. If the time is given in months, we convert it to years.

Caroline got $900 as graduation gifts and invested it in a 10-month certificate of deposit that earned 2.1% interest. How much interest did this investment earn?

Solution

We are asked to find the interest, I .

Organize the given information.

I = ? P = $900 r = 2.1% t = 10 months

Write the formula. I = P r t
Substitute the given information, converting 10 months to 10 12 of a year. I = $900 ( 0.021 ) ( 10 12 )
Multiply. I = 15.75
Check your answer. Is $15.75 a reasonable amount of interest?
If Caroline had invested the $900 for a full year at 2% interest, the amount of interest would have been $18. Yes, $15.75 is reasonable.
Write a complete sentence that answers the question. The interest earned was $15.75.
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Adriana invested $4,500 for 8 months in an account that paid 1.9% interest. How much interest did she earn?

$57.00

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Milton invested $2,460 for 20 months in an account that paid 3.5% interest How much interest did he earn?

$143.50

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Key concepts

  • The formula I = P r t can be used to calculate the amount of interest on an investment. See [link] .
  • By writing an equation based on information provided about simple interest, any value in the equation I = P r t can be found. See [link] .

Practice makes perfect

Use the Simple Interest Formula

In the following exercises, use the simple interest formula to fill in the missing information.

Interest Principal Rate Time (years)
$1200 3% 5

$180

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Interest Principal Rate Time (years)
$1500 2% 4

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Interest Principal Rate Time (years)
$4410 4.5% 7

$14,000

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Interest Principal Rate Time (years)
$2212 3.2% 6

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Interest Principal Rate Time (years)
$577.08 $4580 2

6.3%

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Interest Principal Rate Time (years)
$528.12 $3260 3

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In the following exercises, solve the problem using the simple interest formula.

Find the simple interest earned after 5 years on $600 at an interest rate of 3%.

$90

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Find the simple interest earned after 4 years on $900 at an interest rate of 6%.

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Find the simple interest earned after 2 years on $8,950 at an interest rate of 3.24% .

$579.96

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Find the simple interest earned after 3 years on $6,510 at an interest rate of 2.85% .

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Find the simple interest earned after 8 years on $15,500 at an interest rate of 11.425% .

$14,167

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Find the simple interest earned after 6 years on $23,900 at an interest rate of 12.175% .

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Find the principal invested if $656 interest was earned in 5 years at an interest rate of 4% .

$3,280

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Find the principal invested if $177 interest was earned in 2 years at an interest rate of 3% .

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Find the principal invested if $70.95 interest was earned in 3 years at an interest rate of 2.75%.

$860

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Find the principal invested if $636.84 interest was earned in 6 years at an interest rate of 4.35%.

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Questions & Answers

Application of nanotechnology in medicine
what is variations in raman spectra for nanomaterials
Jyoti Reply
I only see partial conversation and what's the question here!
Crow Reply
what about nanotechnology for water purification
RAW Reply
please someone correct me if I'm wrong but I think one can use nanoparticles, specially silver nanoparticles for water treatment.
Damian
yes that's correct
Professor
I think
Professor
what is the stm
Brian Reply
is there industrial application of fullrenes. What is the method to prepare fullrene on large scale.?
Rafiq
industrial application...? mmm I think on the medical side as drug carrier, but you should go deeper on your research, I may be wrong
Damian
How we are making nano material?
LITNING Reply
what is a peer
LITNING Reply
What is meant by 'nano scale'?
LITNING Reply
What is STMs full form?
LITNING
scanning tunneling microscope
Sahil
how nano science is used for hydrophobicity
Santosh
Do u think that Graphene and Fullrene fiber can be used to make Air Plane body structure the lightest and strongest. Rafiq
Rafiq
what is differents between GO and RGO?
Mahi
what is simplest way to understand the applications of nano robots used to detect the cancer affected cell of human body.? How this robot is carried to required site of body cell.? what will be the carrier material and how can be detected that correct delivery of drug is done Rafiq
Rafiq
if virus is killing to make ARTIFICIAL DNA OF GRAPHENE FOR KILLED THE VIRUS .THIS IS OUR ASSUMPTION
Anam
analytical skills graphene is prepared to kill any type viruses .
Anam
what is Nano technology ?
Bob Reply
write examples of Nano molecule?
Bob
The nanotechnology is as new science, to scale nanometric
brayan
nanotechnology is the study, desing, synthesis, manipulation and application of materials and functional systems through control of matter at nanoscale
Damian
Is there any normative that regulates the use of silver nanoparticles?
Damian Reply
what king of growth are you checking .?
Renato
What fields keep nano created devices from performing or assimulating ? Magnetic fields ? Are do they assimilate ?
Stoney Reply
why we need to study biomolecules, molecular biology in nanotechnology?
Adin Reply
?
Kyle
yes I'm doing my masters in nanotechnology, we are being studying all these domains as well..
Adin
why?
Adin
what school?
Kyle
biomolecules are e building blocks of every organics and inorganic materials.
Joe
anyone know any internet site where one can find nanotechnology papers?
Damian Reply
research.net
kanaga
sciencedirect big data base
Ernesto
Introduction about quantum dots in nanotechnology
Praveena Reply
hi
Loga
what does nano mean?
Anassong Reply
nano basically means 10^(-9). nanometer is a unit to measure length.
Bharti
how did you get the value of 2000N.What calculations are needed to arrive at it
Smarajit Reply
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A soccer field is a rectangle 130 meters wide and 110 meters long. The coach asks players to run from one corner to the other corner diagonally across. What is that distance, to the nearest tenths place.
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Jeannette has $5 and $10 bills in her wallet. The number of fives is three more than six times the number of tens. Let t represent the number of tens. Write an expression for the number of fives.
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Practice Key Terms 4

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Source:  OpenStax, Prealgebra. OpenStax CNX. Jul 15, 2016 Download for free at http://legacy.cnx.org/content/col11756/1.9
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