Simple Interest is the interest on principal when we do not see the next year interest or include for calculation of such interest.

Calculation of Simple interest is very easy:-

Formula of Simple Interest =Principal Amount X Rate/100 X time

Or

S.I.= P x R/100 x t

For example :-

Ram gives the loan to sham Rs. 10000 for 5 years @ 10 % simple interest

Calculate simple interest .

Solution:

Simple Interest = P x R/100 x t =10000 x 10/100 x 5 = RS .5000 /-