Future Value Simple Interest Formula : let’s understand what it means , Before we learn the Future Value Simple Interest Formula. The final amount or the total amount lent at the end of the period is known as the future value at the end of that period. Future Value Simple Interest formula gives us the future value that simple interest will generate after the end of the period. Let us know more about Future Value Simple Interest Formula with solved examples.

What is the Future Value Simple Interest Formula?

The interest earned on that principal amount at the end of the tenure and Future Value Simple Interest Formula is the sum of the principal amount that we have with us at the beginning and The future value simple interest formula is given as,

f v = p + i or f v = p (1 + rt)

Here,

P is the principal amount,
I am interested
r is the rate, and
T is time.

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Examples Using the Future Value Simple Interest Formula

Example 1: If Sam lent his friend $1,500 at an interest rate of 4.3%. Future Value Find the Future Value after 6 Years Using Simple Interest Formula?

Solution: To find: Future value after 6 years.

p = 1500, r = 0.043 (4.3%), and t = 6 (given)

Using the Future Value Simple Interest Formula,

f v = p + i or f v = p (1 + rt)

respect it,
F V = 1500 + I or F V = 1500 (1 + 0.043 × 6)

F V = 1500(1 + 0.258)

F V = 1500(1.258)

F V = 1500(1.258)

F V = 1887

Answer: The future value after 6 years would be $1887.

Example 2: James borrowed $600 from a bank at some rate and the future value quadrupled in 4 years. Use the simple interest formula of future value to calculate the rate at which James borrowed the money.

Solution: To find: interest rate

p = 600, fv = 2400, and t = 4 (given)

using the formula,

f v = p + i or f v = p (1 + rt)

2400 = 600 + I or F V = 600(1 + R × 4)

2400 = 600 + 2400r

1800 = 2400r

R = 1800/2400

R = 0.75%

Answer: The rate of interest on the given amount is 75%.

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