Simple Interest (साधारण व्याज)
Simple interest is common phenomenon of life in our society. Understanding how it works and how it can be used effectively is a good lesson. Simple interest is a way to calculate the extra money paid or earned on a principal amount over time.
Interest (I)
Interest is the extra amount of money earned or paid for using money over a period of time. If you deposit money in a bank, the bank pays you interest for keeping your money with them. If you borrow money, you pay interest to the lender.
If principal \(P\), time \(T\) and interest rate \(R\) are given then simple interest (I) is
\(\boxed{I=\frac{P \times T \times R}{100}}\)
Interest is the extra amount of money earned or paid for using money over a period of time. If you deposit money in a bank, the bank pays you interest for keeping your money with them. If you borrow money, you pay interest to the lender.
If principal \(P\), time \(T\) and interest rate \(R\) are given then simple interest (I) is
\(\boxed{I=\frac{P \times T \times R}{100}}\)
Principal (P)
The principal is the original amount of money you start with before any interest is added. It could be the amount you deposit in an account, invest, or borrow. For example, if you borrow Rs. 10,000, that Rs. 10,000 is the principal.
If Interest \(I\), time \(T\) and interest rate \(R\) are given then Principal (P) is
\(\boxed{P=\frac{I \times 100}{T \times R}}\)
The principal is the original amount of money you start with before any interest is added. It could be the amount you deposit in an account, invest, or borrow. For example, if you borrow Rs. 10,000, that Rs. 10,000 is the principal.
If Interest \(I\), time \(T\) and interest rate \(R\) are given then Principal (P) is
\(\boxed{P=\frac{I \times 100}{T \times R}}\)
Rate (of Interest) (R)
The rate of interest is the percentage of interest to be earned or paid over a period of time. It is usually expressed as an annual rate (per year) but can also be monthly, quarterly. For example, an interest rate of 8\% per year means 8 \% of the principal is added as interest each year.
If Principal \(P\), Interest \(I\) and Time \(T\) are given then rate of interest (R) is
\(\boxed{R=\frac{I \times 100}{P \times T}}\)
The rate of interest is the percentage of interest to be earned or paid over a period of time. It is usually expressed as an annual rate (per year) but can also be monthly, quarterly. For example, an interest rate of 8\% per year means 8 \% of the principal is added as interest each year.
If Principal \(P\), Interest \(I\) and Time \(T\) are given then rate of interest (R) is
\(\boxed{R=\frac{I \times 100}{P \times T}}\)
Time (T)
Time refers to how long the money is invested, deposited, or borrowed for. It is usually measured in years, but it can also be given in months or days. If the time is not in years, it must be converted into years for standard calculations.
If Principal \(P\), Interest \(I\) and interest rate \(R\) are given then Time (T) is
\(\boxed{T=\frac{I \times 100}{P \times R}}\)
The standard relation is
\(\boxed{I \times 100=P \times T \times R}\)
Time refers to how long the money is invested, deposited, or borrowed for. It is usually measured in years, but it can also be given in months or days. If the time is not in years, it must be converted into years for standard calculations.
If Principal \(P\), Interest \(I\) and interest rate \(R\) are given then Time (T) is
\(\boxed{T=\frac{I \times 100}{P \times R}}\)
The standard relation is
\(\boxed{I \times 100=P \times T \times R}\)
Amount (A)
The amount is the total sum of money at the end of the interest period. It includes both the principal (the original money) and the interest earned or paid.
Mathematically,
\(\boxed{A=P+I}\)
or \(\boxed{A=P \left ( \frac{100 +TR}{100} \right )} \)
The amount is the total sum of money at the end of the interest period. It includes both the principal (the original money) and the interest earned or paid.
Mathematically,
\(\boxed{A=P+I}\)
or \(\boxed{A=P \left ( \frac{100 +TR}{100} \right )} \)
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