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
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…..)
  • 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)%

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)

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