{"id":237,"date":"2020-04-21T16:54:07","date_gmt":"2020-04-21T20:54:07","guid":{"rendered":"https:\/\/pressbooks.bccampus.ca\/businessmathematics\/?post_type=chapter&p=237"},"modified":"2024-10-29T14:12:38","modified_gmt":"2024-10-29T18:12:38","slug":"237","status":"publish","type":"chapter","link":"https:\/\/pressbooks.bccampus.ca\/businessmathematics\/chapter\/237\/","title":{"raw":"3.4 Calculating Principal, Rate and Time","rendered":"3.4 Calculating Principal, Rate and Time"},"content":{"raw":"If any three of the four variables in the relationship ([latex]I = Prt[\/latex]) are given, you should be able to calculate the value of the unknown variable. Starting with the basic interest equation:\r\n

[latex]I = Prt[\/latex]<\/p>\r\nYou can solve for P or r<\/em> or t<\/em> as follows:\r\n

[latex]P=\\frac{I}{rt}[\/latex]<\/p>\r\n

[latex] t=\\frac{I}{Pr}[\/latex]<\/p>\r\nSince r is the rate in percent per year, the answer for t will be in years (or part thereof):\r\n

[latex]r=\\frac{I}{Pt}\\times100%[\/latex]<\/p>\r\nSince \u00a0is the time in years, the answer for \u00a0will be the annual rate of interest in decimal form.\r\n\r\n \r\n

\r\n

Knowledge Check 3.1<\/p>\r\n\r\n<\/header>\r\n

\r\n\r\nNow try these exercises.\r\n
    \r\n \t
  1. What is the interest charged to borrow $3,000 for 180 days at 6% simple interest?<\/li>\r\n \t
  2. If $55 interest was charged for a loan at 5.5% simple interest for 125 days, how much was borrowed?<\/li>\r\n \t
  3. How many days will it take a savings deposit of $900 to earn <\/strong>at least $65 interest, if the simple interest rate is 7.5%?<\/li>\r\n \t
  4. What rate of simple interest is used when a deposit of $975 earns $36.73 interest in 220 days?<\/li>\r\n<\/ol>\r\nSolutions at the end of the chapter<\/a>\r\n\r\n<\/div>\r\n<\/div>\r\n \r\n

    Your Own Notes<\/h2>\r\n