Lowercase r is the interest rate. To calculate the monthly payment on an interest only loan simply multiply the loan balance times the monthly interest rate. Total Interest Paid Total Monthly Payment Amount of Mortgage.
We typically use years as a measure of.
I is the interest cost P is principal or the original amount borrowed R is the rate of interest expressed as a decimal T is term or length of the loan. A P 1 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. After one year you will have 105 and after two years you will have 110. P is the principal amount that is either invested or owed.