Interest I Principal P times Rate Per Period r times Number of Periods n Divide an annual rate by 12 to get r if the Period is a month. Simple interest means that interest payments are not compounded the interest is applied to the principal only. Simple interest is different than the compound interestIt is calculated on the main amount of loan.
Where r is in decimal form.
A P1 rt where P is the Principal amount of money to be invested at an Interest Rate R per period for t Number of Time Periods. The main formula to calculate the simple interest is the same. Input rate in some variable say rate. Divide both sides by 6.