Simple Interest Calculation Worksheet

Simple Interest Calculation Worksheet

Read each question carefully and show all your work. Use the formula I = PRT, where I is simple interest, P is principal, R is annual interest rate (as a decimal), and T is time in years.

1. Simple interest is calculated only on the original   amount.

2. The annual interest rate (R) must be converted to a   before calculations.

3. The variable T in the simple interest formula represents   in years.

4. What is the simple interest earned on $5,000 at an annual interest rate of 3% for 4 years?

5. A loan of $10,000 accrues $1,200 in simple interest over 3 years. What is the annual interest rate?

6. You invest $2,500 at a simple interest rate of 6.5% for 2.5 years. Calculate the total amount you will have at the end of the investment period.

7. A car loan of $18,000 has a simple interest rate of 4.2% per year. If the total interest paid on the loan was $2,268, how long was the loan for?

8. Simple interest calculations always assume that the interest earned is reinvested.

9. If the time period is given in months, it should be divided by 12 to convert it to years for the simple interest formula.

10. Sarah borrowed $3,000 from her parents at a simple interest rate of 2% per year. She paid back the loan after 18 months. How much total interest did Sarah pay, and what was the total amount she repaid?