8th Class Mathematics Simple and Compound Interest Simple Interest

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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