🎓 Finance & Economics • Interest & Time Value
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Simple Interest Calculator (I = P·r·t)
Calculates simple linear interest and total loan repayment amounts over days, months, or years.
Fixed Linear Return Calculator
Simple Interest (I = P · r · t)
Computes non-compounding linear interest on short-term promissory notes, certificates of deposit (CDs), and fixed bonds.
Total Repayment (Principal + Interest)
$5,750
Total Simple Interest: $750Daily Interest Accrual$0.68 / day$20.83 / month
Compound Interest Cost+$38.13Extra earned if compounded annually ($$5,788.13)
Simple Return on Capital+15.0%Across full 3 year duration
Calculation Proof:
Interest I = P · r · t = $5,000 × 0.0500 × 3 yrs = $750; Total = $5,000 + $750 = $5750
What is Simple Interest?
Simple interest is a quick, straightforward method of calculating the interest charge on a loan or investment based exclusively on the original principal.
Formula & Step-by-Step Calculation
I = P · r · t, Total Repayment = P + I
Linear interest equation.
Worked Step-by-Step Examples
Example 1
A $5,000 promissory note at 5% simple annual interest for 3 years
Solution: Interest I = $750.00, Total Repayment = $5,750.00
• I = 5,000 × 0.05 × 3 = $750; Total = 5,000 + 750 = $5,750
Common Real-World & Academic Use Cases
- ✓ Short-term personal and auto loans
- ✓ Treasury bill fixed yields
- ✓ Commercial paper and promissory note evaluations
How to Use the Simple Interest Calculator (I = P·r·t)
1
Enter Principal & Rate
Input borrowed or invested amount.
2
Enter Term
Specify duration in years.
3
Read Interest
Inspect total interest and final maturity value.
Frequently Asked Questions
Q: How is simple interest different from compound interest?
Simple interest is earned only on the initial principal, whereas compound interest is earned on both the principal and previous accumulated interest.