21. SIMPLE INTEREST
IMPORTANT FACTS AND FORMULAE
1..
Principal
: The money borrowed or lent out for a certain period is called the
principal
or the
sum.
2
. Interest
: Extra money paid for using other's money is called
interest.
3.
Simple Interest (S.I.)
: If the interest on a sum borrowed for a certain period is reckoned
uniformly, then it is called
simple interest.
Let Principal = P, Rate = R% per annum (p.a.) and Time = T years. Then,
(i)
S.I. =
(P*R*T )/100
(ii)
P=(100*S.I)/(R*T) ;R=(100*S.I)/(P*T) and T=(100*S.I)/(P*R)
SOLVED EXAMPLES
Ex. 1
.
Find the simple interest on Rs. 68,000 at 16 2/3% per annum for 9 months.
Sol.
P = Rs.68000,R = 50/3% p.a and T = 9/12 years
= 3/4years.
∴
S.I. = (P*R*T)/100 = Rs.
(
68,000*(50/3)*(3/4)*(1/100)
)
= Rs.8500
Ex. 2. Find the simple interest on Rs. 3000 at 6 1/4% per annum for the period from
4th Feb., 2005 to 18th April, 2005.
Sol.
Time = (24+31+18)days = 73 days = 73/365 years = 1/5 years.
P = Rs.3000 and R = 6 ¼ %p.a = 25/4%p.a
∴
S.I. = Rs.
(
3,000*(25/4)*(1/5)*(1/100)
)
= Rs.37.50.
Remark : The day on which money is deposited is not counted while the day on which
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
This is the end of the preview.
Sign up
to
access the rest of the document.
 Spring '11
 vinh
 Rs.

Click to edit the document details