5 minutes? Calculate the simple interest on R1 200 at \( 7 \% \) p.a. for 3 years using the formu \( \mathrm{I}=\frac{P r t}{100} \)

To calculate the simple interest, we can use the formula: \( \mathrm{I} = \frac{P r t}{100} \). Here, \( P \) is the principal amount (R1,200), \( r \) is the annual interest rate (7%), and \( t \) is the time in years (3). Using the values: \( \mathrm{I} = \frac{1200 \times 7 \times 3}{100} \) Now, let's perform the calculations. \( \mathrm{I} = \frac{1200 \times 21}{100} \) \( \mathrm{I} = \frac{25200}{100} \) \( \mathrm{I} = 252 \) So, the simple interest after 3 years will be R252. Simple interest calculations have been utilized for centuries, with origins traceable to ancient civilizations like Mesopotamia. Merchants would use these calculations to determine the return on money lent or borrowed, laying the foundation for modern banking and financial systems. That's right; next time you do simple interest math, remember you're following in the footsteps of ancient traders! In today's world, simple interest is commonly seen in various financial products like personal loans and savings accounts. For example, if you take a personal loan with a fixed interest rate, understanding how simple interest works helps you evaluate what you owe over time. It's an essential skill that can help you make informed financial decisions and manage your money better!