Simple Interest
Principal : The money borrowed or lent for a certain period is called Sum or Principal
Interest : The extra money paid for the money borrowed is termed as Interest.
Simple Interest :Interest paid on principle amount for certain period of time is termed as simple interest.
Where P is Principle, T is Number of years, R is Rate of Interest
Rule : Simple Interest for D number of days, If P is Principle amount and R is Rate.
Ex. Mohan borrowed some money at the
rate of 5 % p. a. for the first two years, at a rate of 8 % p. a for the
next three years, and at the rate of 10 % for the period beyond five
years.. If he pays total interest of Rs. 12500 at the end of 8 years,
how much mony did he borrows ?
Solution : Let P be the sum borrowed
Ex. A sum of money doubles itself in 8 years at simple interest. What is the rate of interest ?
Solution :Let the Sum is Rs 100, after 8 years it will become 200
So Interest will be = 200 - 100 = 100
, so the rate of interest will be :
Ex. A sum of money amounts to Rs. 9800
after 5 yers and Rs. 12005 after 8 years at the same rate of simple
interest. What is the rate of interest per annum ?
Solution : Simple interest for 8 years - Simple interest of 5 years = Simple interest for 3 years = 12005 - 9800 = 2205
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