Word Problems With Percents - Problem 3

When you invest money in a bank, the amount you put in is called the principle, and the bank will give you back a percent of that principle, which is called the interest rate. Different banks and different types of accounts offer different types of interest. If the interest is applied only to the principle investment, it is called simple interest. (Compound interest is a different kind that you'll study later, when the interest is applied to the principle and interest already applied in total.) We calculate simple interest by finding the percent times our principle, and then multiplying that times the number of years that the interest is applied. If we add that to the original investment amount, we'll have the total amount of money in the bank.