Math Percentage calculation Interest calculation

# Simple Interest Calculation

The interest calculation is an application of the percentage calculation.

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### Remember

By using the interest calculation, you usually have to use different terms.

• Original value $w$ → principal $P$
• Percentage value $p$ → interest amount $I$
• Percentage rate $r\%$ → interest rate $r\%$

The formulas don’t change:

$P=\frac{I}{r\%}$

$I=r\%\cdot P$

$r\%=\frac{I}{P}$

### Example

Lena has 200 € in her passbook with an interest rate of 5 percent. What are the interest rates in a year?

It is given: $P=200€$ und $r\%=5\%$

$I=r\%\cdot P$
$I=5\%\cdot 200€$ $=\frac{5}{100}\cdot200€$ $=10€$