Tuesday, September 30, 2008

Definition of Simple Interest and its formula

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