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Definition of simple interest?
Simple interest is a term that is used for quickly calculating the interest charge on a loan.
How does one calculate the interest rate on a loan?
Calculating the interest rate on a loan isn't that difficult. A person will need to take the principal amount and multiply it by the term of the loan and the annual percentage rate.
In the formula for calculating interest the principal is multiplied by the rate and then multiplied by the?
time
How do you apply Indices in real life?
They are used when calculating areas or volumes, for acceleration, for compound interest.
The concepts of simple interest and compound interest?
With simple interest, you just multiply the capital, the number of years, and the yearly interest rate. For example, for a capital of 10,000 dollars, 3% interest, 10 years, that would give you 10,000 x 3/100 x 10 = 3,000 dollars interest.With compound interest, after the end of every year, the interest is added to the capital, before calculating the interest for next year.In the example above, the first year you get 10,000 x 0.03 = 300 dollars. This is then added to the capital, before calculating the interest rate for the next year; so, the second year you get 10,300 x 0.03 = 309 dollars interest.
