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Interest and Interest Rate Calculation

Units and Fractions Interest and Interest Rate Calculation

🎬 Video Tutorial

(0:01) Understanding Principal and Interest: The principal is the initial amount of money invested, while interest is the extra amount earned based on a set interest rate, typically yearly.
(0:18) Calculating Simple Interest: Interest is calculated by multiplying the principal by the interest rate. For example, £100 at 5% interest results in £5 interest after 1 year.
(2:35) Determining Principal from Interest Earned: To find the initial investment when interest and rate are known, divide the interest by the rate (e.g., £30 at 5% interest implies an initial principal of £600).

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📂 Revision Cards

Understanding interest calculation with principal amount, interest rate, and total amount examples.

Example for Interest calculation, showing the formula for calculating interest on £200 at 3% over 60 days, resulting in a total amount of £201.

Example for calculating the interest rate, demonstrating the formula for interest with £200 principal and 4% interest rate.

Illustration of calculating the principal using a 5% interest rate, earning £30 after 1 year, with the formula and steps to solve for the principal.

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