Question

1) What is the simple interest if Principal = $100, Rate = 5% and time = 3 months?

2) Find the simple interest given that Principal = $900, Rate = 5% andd Time =1 year 4 months.

Answer 1

1. 1.25, 2. $60

Explanation:

1. 100 x .05=$5 interest/year

$5/12=.42 interest per month

.42x3 =1.25 interest for 3 months

2. 900 x .05=$45 interest/year

$45/12=3.75 interest/month

$3.75 x 16 months=$60 interest/16 months