Unit 1 Simple Interest
Unit 1 Simple Interest
Unit 1 Simple Interest
Basic Arithmetic
Simple Interest
• Simple interest is a quick and easy method to
calculate interest on the money, in the simple
interest method interest always applies to the
original principal amount, with the same rate of
interest for every time cycle.
• When we invest our money in any bank, the
bank provides us interest on our amount. The
interest applied by the banks is of many types
one of them is simple interest.
Simple Interest Formula
• Simple interest is calculated with the following formula: S.I. = P × R ×
T, where P = Principal, R = Rate of Interest in % per annum, and T = Time,
usually calculated as the number of years. The rate of interest is in percentage
r% and is to be written as r/100.
• Principal: The principal is the amount that initially borrowed from the bank
or invested. The principal is denoted by P.
• Rate: Rate is the rate of interest at which the principal amount is given to
someone for a certain time, the rate of interest can be 5%, 10%, or 13%, etc.
The rate of interest is denoted by R.
• Time: Time is the duration for which the principal amount is given to
someone. Time is denoted by T.
• Amount: When a person takes a loan from a bank, he/she has to return the
principal borrowed plus the interest amount, and this total returned is called
Amount.
Simple Interest Formula
Amount = Principal + Simple Interest
1. A = P + S.I.
2. A = P + PRT/100
3. A = P(1 + RT)
Questions of Simple Interest
• Question no 1: Calculate the Simple Interest
if the principal amount is Rs. 2000, the time
period is 1 year and the rate is 10%. Also,
calculate the total amount at the end of 1 year.
Questions of Simple Interest
• Question no 2: Manish's father had borrowed
$1,000 from the bank and the rate of interest
was 5%. What would the simple interest be if
the amount is borrowed for 1 year? Similarly,
calculate the simple interest if the amount is
borrowed for 2 years, 3 years, and 10 years?
Questions of Simple Interest
• Question no 3: If Ashish borrowed a sum of
Rs. 46,500 for a period of 21 months at 20%
per annum, how much simple interest will she
pay?
Simple Interest Formula
1. To calculate the Principal Amount, the formula is:
• P = (S.I × 100) / RT
2. To find the rate of interest, the formula will be:
• R = (S.I × 100)/ PT
• R (in decimal ) = S.I/PT
2.2 Thus, the rate of interest in percent is given by:
• R = R * 100
3. To get the time, formula is:
• T = (S.I × 100) / PR
Simple Interest Questions
• Question no 4: A sum fetched a total simple
interest of Rs. 4016.25 at the rate of 9 %. p.a.
in 5 years. What is the sum?
Simple Interest Questions
• Question no 5: A amount of money has
acquired the simple interest of Rs. 7000 at the
rate of 10%. p.a. in 2 years. What is the sum?
Simple Interest Questions
• Question no 6: A four year Indira Vikas
certificate with a maturity value of Rs. 700 is
purchased for Rs. 500. What is rate
percentage?
Simple Interest Questions
• Question no 7: A five year loan amount has
yielded Rs. 8000 with the principle amount Rs.
4000. What is rate percentage?
Simple Interest Questions
• Question no 8: How much time will it take for
an amount of Rs. 450 to yield Rs. 81 as
interest at 4.5% per annum of simple interest?
Simple Interest Questions
• Question no 9: How much time will it take for
an amount of Rs. 900 to yield Rs. 81 as
interest at 9% per annum of simple interest?
Simple Interest Questions
• Questions no 10: What sum of money will
yield Rs. 174/5 as interest in 5 years at 4 % per
annum?
Simple Interest Questions
• Questions no 11: Find the interest on Rs. 640
from March 15 to September 1st @5 % p. a ?
th
Simple Interest Questions
• Questions no 12: P. V. Sindhu receives Rs.
3412 as amount by lending Rs. 1700 for 20
years at a certain rate of interest? What sum
will amount Rs. 5200 in 6 years if it is lent at
the same rate of interest?
Simple Interest Questions
• Questions no 13: B. Punia borrowed a certain sum at 6 % p.a and immediately
lent the same to another person at 8 % p.a. He gained Rs. 120 in 6 months. What is
the sum the person borrowed?
Simple Interest Questions
• Questions no 14: Ravi Dahiya borrowed a certain sum at 10 % p.a from Manpreet
Singh and immediately lent the same to P. R. Sreejesh person at 14 % p.a. He
gained Rs. 200 in 6 months. What is the sum the person borrowed?
Simple Interest Questions
• Questions no 15: Amit lent Rs. 10000 to two persons at 6% in two parts.
The First person borrowed at 5% and the second borrowed at 6% p.a. If
Amit receives Rs. 12240 as the total amount after 4 years what sum was
borrowed by each of the two persons?
Simple Interest Questions
• Questions no 17: Anju deposited Rs. 5000 on 20th April in a bank paying
interest at 6% p.a. She withdraws Rs. 3000 on 15th May and deposited Rs.
4000 on 6th June. How much interest was due to her on 30th June
following?
Simple Interest Questions
• Questions no 18: Mirabai Chanu deposited a certain sum of money in a
post office at 12% interest p.a. for 4 years and deposited an equal amount
in fixed deposit in a bank for 5 years at 15% p.a. If the difference in the
accumulated interest in the two accounts is Rs. 1350, Find the sum
deposited in each case?