Simple Interest Formulas

What is Principle Amount in Simple Interest?

The principle is the base amount that is borrowed or lent for a pre-decided amount or duration of time.

What is interest in Simple Interest?

The extra amount to be paid for borrowing a sum or a duration of time.

The four variables in the formula are:

• SI=Simple Interest
• P=Principal Amount (This the amount invested)
• T=Number of years
• R=Rate of interest (per year) in percentage

Amount = Principle + SI

Simple Interest =		P x R x T
		100

Time =		SI x 100
		P x R

Rate =		SI x 100
		P x T

Principle =		SI x 100
		T x R

For different years if there are different rates, then

Simple Interest =	Principal x	(R1+R2+ R3…..)
		100

• If sum becomes n times in T yr at simple interest, then the formula for calculating the rate of interest

Rate of Interest =	100 x	(n – 1)	%
		T

Ques. A sum of money becomes 4 times in 20 yr at SI. Find the rate of interest?

R =100(4-1)/20 =100*3 / 20 =5*3 =15 5).

• If A sum becomes n times in at a certain rate of interest .then the time taken, in which the same amount will be n times at the same rate of interest?

Time Taken =	T x	(n – 1)
		2

Ques.If A sum becomes 3 times in at certain rate of interest in 5years .find the time taken in the same amount will be 8 times at the same rate of interest: =

(8-1)/2*5 = 7/2 * 5 =17.5years