Simple Interest Worksheet
Most simple interest worksheets hand students a principal, a rate, and a time period, then ask them to plug numbers into a formula. This one starts there, but it doesn't stop there. It puts the simple interest formula side by side with the compound interest formula and then asks students to use both while working through a full scenario about a credit card user named Amy.
The setup is straightforward. Amy has used credit responsibly for years, then makes a series of decisions, some good, some risky, that a class has to sort into positive, negative, or no impact on her credit. That sorting exercise does the real teaching. It's easy to memorize "pay on time" as a rule. It's harder to recognize why applying for several new credit cards in one year can hurt a credit score even when every payment is made on time.
From there, the worksheet moves into the math. Students calculate what $2,500 in credit card debt becomes after five years of 25% compounding interest, separate the growth into principal and interest, and work through how long it takes to pay off $1,000 at a fixed monthly payment with no interest at all, a control scenario that makes the cost of interest visible by contrast. A short block of multiple-choice questions on credit scores and APR rounds out the vocabulary side.
Because it moves between definitions, credit-impact judgment calls, and interest calculations, this worksheet works best as a capstone activity rather than a first exposure to any one of those topics. Students should already know what a credit score is and have seen the simple interest formula before this makes full sense as written.
Below is the worksheet exactly as it appears in the Rapunzl curriculum, followed by teacher notes on how to use it in class.
This activity is from Module 3 of the Rapunzl curriculum, The Power & Risk of Credit Cards.
Advanced Credit Activity
Knowing how to manage your credit well is essential to financial stability. In this exercise you will learn about Amy, a college graduate, and the financial decisions that she makes. After reading about her financial behavior, determine whether each decision made a positive, negative, or no/minimal impact on her credit.
IMPORTANT FORMULAS
Calculating Simple Interest 𝐴 = 𝑃 (1 + (𝑅 𝑇))
Calculating Compound Interest 𝐴 = 𝑃 * (1 + 𝑅)^𝑇
A: New Amount P: Initial Amount (Principal) R: Annual Interest Rate T: Time In Years
KEY TERMS
APR: Annual Percentage Rate CLR: Consumer Leverage Ratio
Q1: Below we have compiled a list of financial decisions, social behaviors, and savings plans that Amy may have made. Your job is to figure out the impact these behaviors will have on Amy’s credit. Please write if the impact on credit was “GOOD”, “BAD”, or “NONE.” Beware of some trick questions!
| Amy’s Behavior | Impact |
|---|---|
| Amy’s been using her credit card for the last four years and has always made her payments on time. Sometimes she pays the full amount, but she always pays at least the minimum. | |
| Amy applies for a new credit card with a higher limit which she can afford, increasing the number of credit cards which she currently has. | |
| She applies for a job as a nurse at the local hospital. As part of the process, they order a credit report on Amy. She gets the job! | |
| She finds an apartment, and her landlord orders a credit report to check if she can consistently afford the rent and mortgage. | |
| Amy’s excited about her new apartment and buys all new furniture, pushing her credit card over its limit. | |
| She buys new outfits for the weekend and maxes out 3 of her 4 credit cards. | |
| Amy struggles to make her many credit card payments, along with meeting her rent. She’s late on two of her credit card payments. | |
| Amy’s car breaks down, and she decides to buy a new one. The car dealer turns down her request for a loan due to poor credit. | |
| Amy seeks help from a reputable local nonprofit credit counseling agency. | |
| Amy sticks to her spending plan and meets all her minimum payments; but she rarely is able to pay more than the minimum amount. | |
| Amy cancels three of her newly acquired credit cards and learns to use her remaining credit cards only when she really needs them. | |
| Amy continues to use one or two credit cards, but she always makes at least the minimum payment. She tries to pay off her card completely if possible | |
CLASS ACTIVITY
After graduation, Amy has been having a hard time lately with her finances and incurred $1000 in credit card debt. Her credit card company only requires a minimum payment of $25 a month but charges him a 15% interest rate on her debt.
He only makes minimum payments of $25 per month, instead of paying down the $1000 in debt. Let’s check out how her debt changes with time:
Q2: Which of these are a good credit score? A: 400 B: 675 C: 710 D: 730 E: 895
Q3: Comparing the APR among several credit cards allows you to obtain the: A. lowest grace period B. lowest annual fee C. lowest interest rate D. least expensive method of calculating interest
Q4: Why is it important to understand the APR associated with a new credit card?
Q5A: You owe $2,500 in credit card debt which has a 25% annually compounding interest rate. How much will you owe in 5 years?
Q5B: What amount of the debt in Q5A after 5 years is interest? And how much of the debt is the initial principal?
Q6: You get your monthly credit card statement and are offered the option of making a minimum payment of $15 per month. If the credit card company charged you NO interest (which would never happen!) How many months would it take you to pay off the $1,000?
Q7: What are some of the benefits of paying off a credit card quickly?
Q8: How might paying extra money each month affect the time it takes to pay off your purchase? Write 2-3 sentences to help show your thinking.
Teacher Notes
This worksheet works best after your class has already covered how credit scores are calculated and what a credit report shows, since the sorting exercise assumes that background. Give students a few minutes to work through Amy's behaviors independently before discussing as a group. Several are designed to be less obvious than they first appear, like the credit report a landlord requests versus the one an employer requests. Let students defend their answers before you weigh in.
The class activity section works well as guided math. Walk through the first month or two of $25 payments toward $1,000 in debt on the board before releasing students to Q5A and beyond, so they can see how a fixed minimum payment barely dents a balance while interest keeps compounding. The compound interest formula from the top of the sheet is exactly what they'll need for Q5A and Q5B.
Save Q7 and Q8 for a short written response or exit ticket. They ask students to reason about paying down debt faster in their own words rather than plug numbers into a formula, which is a good check on whether the math connected to an actual takeaway about how credit card debt behaves over time.
This worksheet is one piece of the full Power & Risk of Credit Cards unit inside the Rapunzl teacher portal, where activities like this one sit alongside articles, guided practice, and a classroom investing simulator built for grades 6–12.
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