Simple Interest

Algebra2go Pre-algebra Supplemental Instruction Video Series

Category:

Education

Tags:

• MuchoMath
• Algebra2go
• prealgebra
• algebra
• math

[GamblerJustice]

Did you uplaod the same video twice? Because this is identical to the other Simple Interest video.

[MuchoMath]

GamblerJustice, Yes there is another formula that can be used! It is the Compound Interest formula! You will find the formula on my lecture notes on the Algebra2go page. It is A=P(1+r/n)^(nt)

A=The amount in the account

P=Principal

r=Interest Rate

n=The number of times the principal is compounded per year.

t=Time in years

Try this formula using P=2000, r=0.07, t=2, and n=1 since the principal is being compounded yearly. You will see that A=$2289.80!

Hope all is well!

[MuchoMath]

Had a typo on the first version ;(

[mydogsuger]

Ugh charlie talkes too fast!!!:(

[MuchoMath]

@MegaMegaCece Yes, there are 365 days in a year! But for "Simple Interest" calculations, 360 days is used to represent 1 year. One example is a yield calculation for a Treasury Bill or T-Bill. T-Bill yield calculations that have short term maturities, say 3 months, use 360 days to represent 1 year.

[themjep]

US uses 360 days instead of 365. I guess they can't solve with an extra 5.

[slingshot2004]

dude year is 365 days!

[debodrumsitck27]

:P kinda cheesy in the beg but watever. I am doin a math project and I need 3 math vids per slide. I can't find any other 1s so I guess I will use this 1

[saeedinho]

thanks man

[gcal6399]

how is that .5 years?

[33FreddyKrueger33]

good video but the second problem is compound interest not simple