Videos: Simple Interest

What is Simple Interest?

1. You deposit $1000 into a bank account that pays 10% simple. How much interest would you earn if:

(a) You left the money in for 2 years?

(b) You left the money in for 6 months?

(c) You left the money in for 9 months?

(d) Your deposit was March 3 and you withdrew the money November 7 the same year?

(e) Your deposit was on April 6 and you withdrew the money on Dec. 23 the same year?

(f) You made a deposit November 12, 2012, and withdrew the money March 15, 2013?

(g) You made a deposit October 28, 2012 and withdrew the money September 21, 2013?

2. On December 1, your one year term deposit comes due and you collect the principal and $120 in interest. The term deposit paid 6% simple interest.  How much money did you deposit?

3. 18 months ago you purchased a bond that paid 7.5% simple interest. You cashed in the bond and received the principal plus $337.50 in interest.  Find the principal.

4. On May 31 you decided it was time to start a new life in the palm trees. You emptied out your bank account.  You received your principal of $1750 and interest of $437.50.   How long had your money been in the bank if the account paid interest at 5% simple?

5. On your 65th birthday you eagerly cash in one of your RRSP’s. You receive a total of $4295.  Your original investment was $3000 and the RRSP paid interest at 7% simple.  How many months was your money in the RRSP?

6. How long will it take you to double your money at 8% simple?

7. On March 6th you deposit $3000 into a bank account. You withdraw the principal and interest totaling $3123.29 on December 31.  What interest rate was paid?

8. On December 16, 2011 you withdraw your entire Christmas fund of $2098.63 from your account. You deposited $2000 on February 19 of 2011 (not a leap year).  What simple interest rate was paid?

9. You have decided to start a new car fund. You deposit $6000 into an account paying 10% simple interest.  How much money will you have in 50 months?

10. On December 31 you repaid a loan to the Hammerhead Finance and Loan Company. You repaid $6000 which was principal and interest on a five year loan at 10% simple.  How much money did you borrow?

Chapter Attribution

Video chapter in Business Mathematics by Chris Kellman, Leslie Major, Don Mallory, Frank Gruen, and Amy Goldlist shared under a CC BY-NC license.