Louisiana State University Personal Finance Interest Rate Questions

1. The principal P is borrowed at a simple interest rate r for a period of time t. Find the simple interest owed for the use of the money. Assume there are 360 days in a year.

P =$8000, r =2.0%, t =15months

2. The principal P is borrowed at a simple interest rate r for a period of time t. Find the simple interest owed for the use of the money. Assume 360 days in a year.

P=$15,500, r=5%, t=30 days

3. The principal P is borrowed at a simple interest rate r for a period of time t. Find the loan’s future value A, or the total amount due at time t.

P = $2000, r = 4%, t = 3 years

4. The principal P is borrowed at a simple interest rate r for a period of time t. Find the loan’s future value A, or the total amount due at time t.

P = $31,000, r = 5.5%, t = 4 years

5. The principal P is borrowed at a simple interest rate r for a period of time t. Find the loan’s future value A, or the total amount due at time t.

P=$3000, r=5.5%, t=3 months

6. The principal P is borrowed and the loan’s future value A at time t is given. Determine the loan’s simple interest rate r.

P = $9000.00, A = $9810.00, t = 1 year

7. The principal P is borrowed and the loan’s future value A at time t is given. Determine the loan’s simple interest rate r.

P = $9000.00, A = $9810.00, t = 3 years

8. Determine the present value P that must be invested to have the future value A at simple interest rate r after time t.

A = $2500, r = 18%, t = 5 years

9. Determine the present value P you must invest to have the future value A at simple interest rate r after time t.

A = $14,000, r = 5.0%, t = 5 years

The present value that must be invested to get $14,000 after 5 years at an interest rate of 5.0% is ?

10. Determine the present value P that must be invested to have the future value A at simple interest rate r after time t.

A = $4000.00, r = 10.0%, t = 9 months

11. In order to start a small business, a student takes out a simple interest loan for $7000.00 for 9 months at a rate of 7.75%.

a. How much interest must the student pay?

b. Find the future value of the loan.

12. Suppose that you borrow $4000.00 from a friend and promise to pay back $8000.00 in 5 years. What simple interest rate will you pay?