# Calculate Simple Interest, Future Value and Present Value

Please see the attached file for the questions.

#### Solution Preview

To calculate Simple Interest we need to use the following formula:

Simple Interest I = Principal x Rate x Time

Interest is the total amount of interest paid.

Principal is the amount borrowed,

Rate is the percentage of principal amount charged as interest each year.

Time is the time involved.

7. Find the simple interest I of the given loan amount.

$4000 borrowed at 6% for 3 years.

Principal P = $4000

Rate r = 6% = 6/100 = 0.06

Time t = 3

To find the simple interest, we multiply 4000 x 0.06 x 3 to get that:

I = $720.00

8. Find the simple interest I of the given loan amount.

$490 borrowed at 6 3/4% for 271 days.

Principal P = $490

Rate r = 6 3/4% = 6.75% = 0.0675

Time t = 271 days ÷ 365 days/year = 0.74 years

To find the simple interest, we multiply 490 x 0.0675 x 0.74 to get that:

I = $24.48

9. Find the simple interest I of the given loan amount.

$5,669 borrowed at 11 3/4% from July 1 to December 31 of the same year.

Principal P = $5669

Rate r = 11 3/4% = 11.75% = 0.1175

Time t = 6 months ÷ 12 months/year = 0.5 years

To find the simple interest, we multiply 5669 x 0.1175 x 0.5 to get that:

I = $333.05

To calculate the Future Value we need to use the following formulas -

Future Value (FV) A = Principal(1 + Rate)^Time

A = P(1 + r)^t

Future Value, A is Total Accrued Amount (principal + interest)

Principal is the amount borrowed,

Rate is ...

#### Solution Summary

The attached solution contains multiple problems related to Simple Interest and Compound Interest. There are examples on how to calculate the Present Value based on Future value of loan and similar examples on how to calculate Future Value.