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Simple Interest


Interest which is paid only on the principal and not on the additional amount generated by previous interest payments. A formula for computing simple interest is

 a(t)=a(0)(1+rt),

where a(t) is the sum of principal and interest at time t for a constant interest rate r.


See also

Compound Interest, Interest

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References

Kellison, S. G. Theory of Interest, 2nd ed. Burr Ridge, IL: Richard D. Irwin, 1991.

Referenced on Wolfram|Alpha

Simple Interest

Cite this as:

Weisstein, Eric W. "Simple Interest." From MathWorld--A Wolfram Web Resource. https://mathworld.wolfram.com/SimpleInterest.html

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