Simple Interest
Category : 8th Class
Simple Interest
Simple interest is the interest calculated on the original principal for a given fixed time in which the accumulated interest from previous period is not added up to the previous principal. Simple interest is normally used for a single period.
Simple Interest \[=\frac{P\times R\times T}{100}\]
Where,
P = Principal (original amount borrowed or loaned)
T = Time periods
R = The rate of interest charged over the principal
Amount
When interest is added to the principal, the value is called amount.
It is denoted by A.
Mathematically,
Amount = Principle + Interest, or A = P + I
Conversion Relations
The various parameters we can be calculated from the relation for the simple interest.
Formula of Time: \[T=\frac{I\times 100}{P\times R}\]
Formula of Principal: \[P=\frac{I\times 100}{T\times R}\]
Formula of Rate: \[R=\frac{I\times 100}{P\times T}\]
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