Calculating interest for part of a year

[Shari]

Hi,

We are in Grade 6 math....my problem is trying to figure out how to calculate interest for part of a year by expressing months as a fraction of a year.
The formula is :
interest = principal x rate x time

example:
$500 x 0.09 x 1/4

$500 x 0.09 = $45.00 then we get stuck

the example tells the answer is $11.25 but I can't figure out what to do with the 1/4 to get that answer

Please help!!

Thanks

 

[masters]

Hi,

We are in Grade 6 math....my problem is trying to figure out how to calculate interest for part of a year by expressing months as a fraction of a year.
The formula is :
interest = principal x rate x time

example:
$500 x 0.09 x 1/4

$500 x 0.09 = $45.00 then we get stuck

the example tells the answer is $11.25 but I can't figure out what to do with the 1/4 to get that answer

Please help!!

Thanks

Hey there Shari,


You did good up to there. $45.00 would be the interest for 1 year. You only want interest for 1/4 of a year. We could do this a couple of different ways.


(1) You could use long division and divide 45 by 4. This will result in 11.25.


(2) You could multiply 45 by 1/4 like this: \(\displaystyle \frac{45}{1} \times \frac{1}{4}=\frac{45}{4}=11.25\)


(3) You could change 1/4 to a decimal (.25) and multiply by 45 like this: \(\displaystyle .25 \times 45 = 11.25\)