Simple interest is calculated solely on the amount initially invested. This calculator can help you deal with many different kinds of simple interest problems. The calculator prints an easy-to-follow, step-by-step explanation.
problem
You deposit some money into a bank account paying 4% simple interest per year. You received $72 in interest after 3 years. How much the deposit (principal) was?
solution
The principal was $600.
explanation
Find the principal by using the formula $ I = P \cdot i \cdot t $, where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.
In this example I = $72, i = 4% and t = 3 years, so
$$ \begin{aligned} I &= P \cdot i \cdot t \\ P &= \frac{I}{i \cdot t} \\ P &= \frac{ 72 }{ 0.04 \cdot 3} \\ \\ P &= 600 \end{aligned}$$Please tell me how can I make this better.