Simple interest
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This document explains simple interest calculations. Simple interest is the amount paid on a loan in addition to the principal. It is calculated using the formula: Interest = Principal x Rate x Time. The document provides examples of calculating simple interest for loans over different periods of time. It also demonstrates calculating the total repayment amount and monthly payments over the loan period.
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Simple interest
1. If an investment of ₱5,000 at 4.5% interest is left for 2 years, the total simple interest accumulated is ₱450.
2. For an investment of ₱7,000 at 7.5% interest over 3 years, the total simple interest is ₱1,575.
3. If an account earned ₱180 interest at a 6% rate in 1 year, the original investment was ₱3,000.
Compound Interest
The document explains compound interest, how it is calculated, and provides examples. Compound interest is interest paid on both the principal amount and accumulated interest over time. It is commonly used in savings accounts and works by compounding interest periodically, such as daily, quarterly, or annually. The document shows how to use a compound interest table to calculate the balance and interest earned for various principal amounts over different time periods at given interest rates that are compounded periodically.
Simple and compound interest
This ppt is helpful in clearing a basic concepts regarding this topic.
Also if you are preparing for competitive exams go through the MCQ given in this ppt.
Compittitve exams like CTET, PTET, SSC, JEE, etc.
Simple Interest
This document discusses simple interest, providing the definition, formula, and examples of calculating interest earned, time to earn a given amount of interest, and maturity value. Simple interest is interest paid only on the principal amount, not on accumulated interest. The formula for simple interest is I = PRT, where I is interest, P is principal, R is the annual interest rate as a decimal, and T is time in years. Examples show calculating interest earned on $200 at 4% for 1.5 years ($12) and the time needed to earn $15 on $300 at 4% (1.25 years). Maturity value is the total value at a specific date, calculated as principal plus interest using the formulas S =
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This document outlines key formulas for calculating compound interest with different conversion periods such as annually, semi-annually, quarterly, and monthly. It defines the periodic rate as the interest rate per conversion period, which is calculated as the annual interest rate divided by the number of conversion periods in a year. Formulas provided calculate the future/compound amount, present value, annual interest rate, and time period, based on inputs like principal, interest rate, number of conversion periods, and future/compound amount.
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This document provides information about simple and compound interest calculations. It defines key terms like principal, interest rate, and time period. It explains the formulas for calculating simple interest and compound interest, both annually and for other time periods like quarterly or monthly. Sample problems are provided for calculating interest, principal, and future values in simple and compound interest scenarios.
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Though we had learnt about Simple and Compound Interests at school, because of the technological advantages and new gadgets over the years we have forgotten how to calculate it. This is my sincere effort to refresh the minds of interested persons about its concepts and how to calculate mannually.
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The power point explains the concept of simple interest and compound interest.It also explains the development of the formula.It is made for VIIIth standard S.S.C text book.
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Simple interest
1. If an investment of ₱5,000 at 4.5% interest is left for 2 years, the total simple interest accumulated is ₱450.
2. For an investment of ₱7,000 at 7.5% interest over 3 years, the total simple interest is ₱1,575.
3. If an account earned ₱180 interest at a 6% rate in 1 year, the original investment was ₱3,000.
Compound Interest
The document explains compound interest, how it is calculated, and provides examples. Compound interest is interest paid on both the principal amount and accumulated interest over time. It is commonly used in savings accounts and works by compounding interest periodically, such as daily, quarterly, or annually. The document shows how to use a compound interest table to calculate the balance and interest earned for various principal amounts over different time periods at given interest rates that are compounded periodically.
Simple and compound interest
This ppt is helpful in clearing a basic concepts regarding this topic.
Also if you are preparing for competitive exams go through the MCQ given in this ppt.
Compittitve exams like CTET, PTET, SSC, JEE, etc.
Simple Interest
This document discusses simple interest, providing the definition, formula, and examples of calculating interest earned, time to earn a given amount of interest, and maturity value. Simple interest is interest paid only on the principal amount, not on accumulated interest. The formula for simple interest is I = PRT, where I is interest, P is principal, R is the annual interest rate as a decimal, and T is time in years. Examples show calculating interest earned on $200 at 4% for 1.5 years ($12) and the time needed to earn $15 on $300 at 4% (1.25 years). Maturity value is the total value at a specific date, calculated as principal plus interest using the formulas S =
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This document provides information about simple and compound interest calculations. It defines key terms like principal, interest rate, and time period. It explains the formulas for calculating simple interest and compound interest, both annually and for other time periods like quarterly or monthly. Sample problems are provided for calculating interest, principal, and future values in simple and compound interest scenarios.
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Though we had learnt about Simple and Compound Interests at school, because of the technological advantages and new gadgets over the years we have forgotten how to calculate it. This is my sincere effort to refresh the minds of interested persons about its concepts and how to calculate mannually.
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The power point explains the concept of simple interest and compound interest.It also explains the development of the formula.It is made for VIIIth standard S.S.C text book.
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The document discusses compound interest, providing examples and formulas. It defines compound interest as interest earned periodically added to the principal to earn further interest. Formulas are provided for compound interest calculated annually, semiannually, quarterly, monthly, and daily. An example calculates the accumulated amount from $1000 invested at 8% compounded annually, semiannually, quarterly, monthly, and daily over 3 years. A quiz question asks the reader to calculate the value of a $3700 investment earning 2.5% interest compounded quarterly over 10 years.
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The document discusses simple interest and simple discount calculations. It introduces the simple interest formula of I=PRT, where I is interest, P is principal, R is rate, and T is time. It explains how to use the formula to calculate interest earned or owed on loans and investments. It also covers finding the maturity value of loans, converting months to fractional years, and calculating interest using ordinary and exact time periods.
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Compound interest is interest calculated on the initial principal amount and also on the accumulated interest from previous periods. It is computed every conversion period, with the principal amount increasing each period to include interest earned. The total amount accumulated at the end of the term is called the compound amount. Common terms include the compound interest, nominal interest rate, periodic interest rate, and conversion periods such as monthly, quarterly, or annually. Formulas can be used to calculate the future value, present value, interest rate, and time or term based on given amounts, rates, and periods of compound interest. Sample problems demonstrated the use of these formulas to solve various compound interest scenarios.
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The document discusses compound interest, which is interest earned on savings that is calculated more than once per year. The key points are:
- Compound interest results in earning interest on both the original deposit and on any interest already earned. The more frequently interest is compounded, the greater the overall return.
- Factors that affect the total amount earned through compound interest include the principal amount, interest rate, compounding frequency, and number of years.
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- There are formulas
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The document discusses simple interest and simple discount calculations. It introduces the simple interest formula of I=PRT, where I is interest, P is principal, R is rate, and T is time. It explains how to use the formula to calculate interest earned or owed on loans and investments. It also covers finding the maturity value of loans, converting months to fractional years, and calculating interest using ordinary and exact time periods.
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Compound interest is interest calculated on the initial principal amount and also on the accumulated interest from previous periods. It is computed every conversion period, with the principal amount increasing each period to include interest earned. The total amount accumulated at the end of the term is called the compound amount. Common terms include the compound interest, nominal interest rate, periodic interest rate, and conversion periods such as monthly, quarterly, or annually. Formulas can be used to calculate the future value, present value, interest rate, and time or term based on given amounts, rates, and periods of compound interest. Sample problems demonstrated the use of these formulas to solve various compound interest scenarios.
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This document discusses simple and compound interest. It provides examples of calculating simple interest using the formula I=PRT, where I is interest, P is principal, R is interest rate, and T is time in years. It then explains compound interest, where interest is earned on both the principal and previously earned interest. The key compound interest formula provided is B=P(1+R)n, where B is the final balance, P is principal, R is the interest rate per period, and n is the number of periods. Examples are given of calculating interest compounded annually and semiannually.
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1. Simple interest is interest paid on the principal amount only and not on accumulated interest. The simple interest formula is I=PRT, where I is interest, P is principal, R is interest rate, and T is time.
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Simple interest
- 2. Simple Interest or flat rate - refer to the amount to be paid on top of the amount borrowed or lent. - it may also be the amount earned by a certain amount of money deposited in a bank.
- 3. I – Interest or the amount of interest paid P – Principal or the amount lent or borrowed R – Rate or the percentage of the principal T – Time (in years) of the loan I = P × R × T
- 4. Carlo purchased a computer by obtaining a simple interest loan. The computer costs ₱48,000 and the interest rate on the loan is 12%. If the loan is to be paid back in monthly installments for 2 years, what is the amount of interest to be in 2 years? What is the total amount to be paid back? How much will he pay monthly?
- 5. Given facts: 1. If the loan is to be paid back in monthly installments for 2 years, what is the amount of interest to be in 2 years? I = ₱48,000 × 0.12 × 2 = ₱ 11,520.00 • Principal: P = ₱48,000 • Interest Rate: R = 12% or 0.12 • Payment Time: T = 2 years I = P × R × T Carlo needs to pay ₱11,520.00 for the interest.
- 6. 2. What is the total amount to be paid back? = ₱48,000 + ₱11,520 = ₱59,520 3. How much will he pay monthly? = ₱59,520 24 months = ₱ 2,480.00 Total amount to be paid = Principal + Interest Carlo will pay ₱59,520 in all. Monthly payment = total amount to be paid 24 months Carlo has to pay ₱ 2,480.00 every month for two years.
- 7. A total of ₱ 1,200 is invested at a simple interest rate of 6% for 4 months. How much interest is earned on this investment? Given facts: = ₱ 1,200 × 0.06 × 0.33 = ₱ 23.76 or ₱ 24.00 • Principal: P = ₱1,200 • Interest Rate: R = 6% or 0.06 • Payment Time: T = 4 mos. or 0.33 Before we can apply the formula, we will need to write the time of 4 months in terms of years. Since there are 12 months in a year: 4 ÷ 12 = 0.33 I = P × R × T The interest earned is ₱24.00
- 8. Practice: To buy a computer, Raquel borrowed ₱3,000 at 9% interest for 4 years. How much money did she have to pay back? Given facts: = ₱ 3,000 × 0.09 × 4 = ₱ 1,080 • Principal: P = ₱3,000 • Interest Rate: R = 9% or 0.09 • Payment Time: T = 4 years I = P × R × T Raquel had to pay back ₱3,000 in principal plus ₱1,080 in interest for a total of ₱ 4,080.00.