LET’S TRY ONE
An amount of $100 earns simple interest at 5% per year for 2 years. How many dollars of interest are earned?
10
Simple interest = principal × rate × time: 100 × × 2 = 10 dollars.
Learning steps & teaching tips
Calculate interest on an unchanged principal over whole years.
- Convert the percent to a fraction or decimal and multiply principal, rate and time.
- Work through the example and explain why each operation is used.
- Estimate or use another method to check the result before choosing.
Try it together
Work with a partner: solve one example, explain the method, then change one number and predict what changes.
Convert the percent to a fraction or decimal and multiply principal, rate and time.