Finance

Simple Interest Calculator

Calculate simple (non-compounding) interest and total balance.

Calculated Output

Interest ($) 150

Total balance ($) 1,150

Formula: interest = P × r × t

Step-by-Step Breakdown

1. Values used:

2. Principal = 1,000 $

3. Annual interest rate = 5 %

4. Years = 3 years

6. Interest = 150$

7. Total balance = 1,150$

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The math behind it

interest = principal × rate × time. Unlike compound interest, it never earns interest on past interest.

$1,000 at 5% for 3 years → 1000 × 0.05 × 3 = $150 interest.

Simple vs compound?

Simple interest grows linearly; compound interest grows exponentially and ends up larger over time.