Arithmetic (Beginner) · Quick Reference

Simple Interest Cheat Sheet

Arithmetic (Beginner) · Lesson 15/21

In one line: simple interest is money earned or paid based only on the original amount (the principal), calculated the same way every period.

Key Ideas

1Principal (P). The original amount of money borrowed or invested.

2Rate (R). The interest rate per year, usually given as a percentage.

3Time (T). The duration of the loan or investment, usually in years.

4Simple Interest Formula. SI = (P x R x T) / 100.

5Amount. The total amount after interest is added: Amount = Principal + Simple Interest.

Find the simple interest on $2,000 at 5% per year for 3 years.

$300

Find the total amount for the previous example.

$2,300

At what rate will $1,500 earn $180 interest in 2 years?

6% per year

SI = (P x R x T) / 100

Amount = P + SI

Find SI on $1,000 at 4% for 2 years.

$80

Find SI on $5,000 at 6% for 1 year.

$300

Find the amount for $3,000 at 5% for 4 years.

$3,600