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Questions and Answers
What does the 'P' represent in the formula for calculating simple interest?
What does the 'P' represent in the formula for calculating simple interest?
- Total amount
- Principal amount (correct)
- Time period
- Interest rate
Which formula is used to calculate simple interest?
Which formula is used to calculate simple interest?
- A = P(1 + rt) (correct)
- A = P - rt
- A = P(1 - rt)
- A = P + rt
If the principal amount is $500, the interest rate is 5%, and the time period is 2 years, what is the total amount of simple interest?
If the principal amount is $500, the interest rate is 5%, and the time period is 2 years, what is the total amount of simple interest?
- $50
- $100 (correct)
- $250
- $125
