7th Grade Math

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Applying Percents

PART A BCDE F

Multi-Part

Lesson 3

GLE 0706.2.4

Use ratios, rates and

percents to solve single-

and multi-step problems

in various contexts.

Main Idea

Solve problems

involving simple

interest.

Vocabulary

principal

simple interest

Financial Literacy: Simple Interest

INVESTING Suni plans to save the

Bank Interest Rate

Nation Bank 3%

Federal Credit Union 2.50%

First Bank 2.75%

$200 she received for her birthday.

The table shows the average yearly

rates at three different banks.

1. Calculate 2.50% of $200 to find the
   amount of money Suni can earn in
   one year at Federal Credit Union.


2. Calculate 2.75% of $200 to find the amount of
   money Suni can earn in one year at First Bank.

Principal is the amount of money deposited or borrowed. Simple

interest is the amount paid or earned for the use of money. To find

simple interest I, use the following formula.

=

Annual interest rate,

written as a decimal.

Interest

Principal Time, expressed in years.

Find Interest Earned

CHECKING Arnold has $580 in a savings account that pays 3%

interest. How much interest will he earn in each amount of time?

5 years

I = prt Formula for simple interest

I = 580 · 0.03 · 5 Replace p with $580, r with 0.03, and t with 5.

I = 87 Simplify.

Arnold will earn $87 in interest in 5 years.

6 months

6 months = _^6

12

or 0.5 year Write the time as years.

I = prt Formula for simple interest

I = 580 · 0.03 · 0.5 p = $580, r = 0.03, t = 0.5

I = 8.7 Simplify.

Arnold will earn $8.70 in interest in 6 months.

V

p

Lesson 3E Applying Percents 359

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