7-7 Simple and Compound Interest
Find the simple interest to the nearest cent.
$1350 at 6% for 7 years
The simple interest is $567.
$240 at 8% for 9 months
9 months is equivalent to
of a year.
The simple interest is $14.40.
$725 at 3.25% for 5 years
The simple interest is $117.81.
$3750 at 5.75% for 42 months
42 months is equivalent to
The simple interest is $754.69.
LOANS Mateo s sister paid off her student loan of $5000 in 3 years. If she made a payment of $152.35 each
month, what was her simple interest rate for her loan?
First find the total amount Mateo s sister will pay.
Mateo s sister made payments of $152.35 each month for 3 years, or 36 months. The total amount she will pay over
the length of the loan is 36 152.35 = $5484.60.
Next, subtract the principal to find out how much interest she paid.
5484 5000 = $484.
Use the simple interest formula to find the interest rate.
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7-7 Simple and Compound Interest
The simple interest is $754.69.
LOANS Mateo s sister paid off her student loan of $5000 in 3 years. If she made a payment of $152.35 each
month, what was her simple interest rate for her loan?
First find the total amount Mateo s sister will pay.
Mateo s sister made payments of $152.35 each month for 3 years, or 36 months. The total amount she will pay over
the length of the loan is 36 152.35 = $5484.60.
Next, subtract the principal to find out how much interest she paid.
5484 5000 = $484.
Use the simple interest formula to find the interest rate.
The simple interest rate for her loan was 3.23%.
Find the simple interest to the nearest cent.
$275 at 7.5% for 4 years
The simple interest is $82.50.
$620 at 6.25% for 5 years
The simple interest is $193.75.
$734 at 12% for 3 months
The simple interest is $22.02.
$2020 at 8% for 18 months
The simple interest is $242.40.
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$1200 at 6% for 36 months
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7-7 Simple and Compound Interest
The simple interest is $22.02.
$2020 at 8% for 18 months
The simple interest is $242.40.
$1200 at 6% for 36 months
The simple interest is $216.
$4380 at 10.5% for 2 years
The simple interest is $919.80.
CARS Thomas borrowed $4800 to buy a new car. He will be paying $96 each month for the next 60 months. Find
the simple interest rate for his car loan.
First find the total amount Thomas will pay.
Thomas will make payments of $96 each month for 60 months. The total amount he will pay over the length of the
loan is 60 96 = $5760.
Next, subtract the principal to find out how much interest he will pay.
5760 4800 = $960.
Use the simple interest formula to find the interest rate.
The simple interest rate for his loan is 4%.
CARS Denise has a car loan of $8000. Over the course of the loan, she paid a total of $1680 in interest at a simple
interest rate of 6%. How many months was the loan?
Use the simple interest formula.
TheManual
length- of
the loan
was 3.5
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years or 42 months.
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INVESTMENTS A certificate of deposit has an annual simple interest rate of 5.25%. If $567 in interest is earned
over a 6 year period, how much was invested?
7-7 Simple and Compound Interest
The simple interest rate for his loan is 4%.
CARS Denise has a car loan of $8000. Over the course of the loan, she paid a total of $1680 in interest at a simple
interest rate of 6%. How many months was the loan?
Use the simple interest formula.
The length of the loan was 3.5 years or 42 months.
INVESTMENTS A certificate of deposit has an annual simple interest rate of 5.25%. If $567 in interest is earned
over a 6 year period, how much was invested?
Use the simple interest formula.
$1800 was invested.
Solve each problem.
Find 66% of 90.
59.4 is 66% of 90.
What is 0.2% of 735?
147 is 0.2% of 735.
Find 250% of 7000.
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7-7 Simple and Compound Interest
147 is 0.2% of 735.
Find 250% of 7000.
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