In this Grade 7 lesson from enVision Mathematics Chapter 3, students learn to apply the simple interest formula by using the percent equation to find interest earned, the interest rate, or the principal. The lesson covers how simple interest represents a proportional relationship between yearly interest and principal, with examples involving savings accounts and loans. Students practice solving for each variable in the relationship: interest amount equals interest rate times principal, extended over multiple years.
Section 1
Use the simple interest formula
If an amount of money, , the principal, is invested for a period of years at an annual interest rate , the amount of interest, , earned is
where
Interest earned according to this formula is called simple interest.
Section 2
Evaluating the Simple Interest Formula I = Prt
The simple interest formula is , where is the interest earned, is the principal (initial amount), is the annual interest rate (as a decimal), and is the time in years. To find the simple interest, substitute the given values for , , and into the formula and calculate.
Expand to review the lesson summary and core properties.
Section 1
Use the simple interest formula
If an amount of money, , the principal, is invested for a period of years at an annual interest rate , the amount of interest, , earned is
where
Interest earned according to this formula is called simple interest.
Section 2
Evaluating the Simple Interest Formula I = Prt
The simple interest formula is , where is the interest earned, is the principal (initial amount), is the annual interest rate (as a decimal), and is the time in years. To find the simple interest, substitute the given values for , , and into the formula and calculate.