Simple Interest
Mrs. Garcia’s daughter received $200 for her birthday. If she puts it in the bank and receives 4% interest, how much interest will she earn after 3 years?
How much money will she have total?
After three years, Mrs. Garcia is broke! She needs $50 for groceries. She asks her daughter Kaitlin for a loan but Kaitlin says “Mommy, I will lend you the money but will charge you 5% interest per month. Mrs. Garcia takes three months to pay Kaitlin back. How much total did Mrs. Garcia pay Kaitlin?
Mrs. Garcia’s son wants a MacBook Air. He wants the basic model at $999.00. In order to cover the tax, apps, and a case, he asks the bank to lend him $1,200 on a three year loan. The bank offers him the money but with 8% interest. After three years, how much interest will he have paid? How much total will he have paid the bank?