My Tax & Diary

Simple Interest - Facts and Formulae


1. Principal :The money borrowed or lent out for a certain period is called the principal or the sum.


2. Interest :Extra money paid for using other’s money is called interest.


3. Simple Interest (S.I.) :If the interest on a sum borrowed for certain period is reckoned uniformly, then it is called simple interest.


Let the principal = P, Rate = R% per annum (p.a) and Time = T years. Then ,


1. S.I. = (P x R x T )/ 100)


2. P = (100 x S.I.) / R x T)


3. R = (100 x S.I) / P x T)


4. T = (100 x S.I.) / P x R)












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