What does “simple interest” mean?
Simple interest means multiplying the amount of the loan by the interest rate for the period and having the interest paid at the end of each month or year in a lump sum. For example, you borrow $1,000 at 10% interest for one year, and pay back the principal of $1,000 and
interest of $100 at the end of the year, for a total of $1,100.