<p><a href="https://www.prepswift.com/quizzes/quiz/prepswift-simple-interest" target="_blank">Simple Interest Exercise</a></p><p>If you're receiving <span style="color:#27ae60;">Simple Interest</span> on some money you deposited in the bank, that means you're getting the <strong>same amount of interest money each year</strong>. For that reason, the algebraic equation that describes simple interest is a linear equation, assuming $t$ is the total amount including interest, $p$ is the principal (the money deposited), $n$ is the number of years the money is held in the bank account, and $r$ is the interest rate as a percent (see below):</p>
<p>$$t = p + pn(\frac{r}{100})$$</p>
<p><strong><span style="color:#8e44ad;">Example</span></strong></p>
<p>Let's imagine you deposit $\$100$ in a bank account earning $5\%$ simple annual interest for $9$ years. How much money would you have in total at the end of the $9$ years?</p>
<p>$$total = 100 + 100(9)(.05) = 145$$</p>
<p>You only had to wait $9$ years to get $\$45$!!! Wow!</p>