The interest earned on Rs. 2250 at the rate 3% simple interest per annum for 2 years will be:
Rs. 135
Calculating Simple Interest Earned
Simple interest is a type of interest that is calculated only on the principal amount. It is the easiest way to calculate interest on a loan or deposit.
The formula used to calculate simple interest is:
\( \text{Simple Interest (SI)} = \frac{\text{Principal (P)} \times \text{Rate (R)} \times \text{Time (T)}}{100} \)
Let's identify the given values from the question:
- Principal amount (P) = Rs. 2250
- Rate of interest (R) = 3% per annum
- Time period (T) = 2 years
Now, we will substitute these values into the simple interest formula:
\( \text{SI} = \frac{2250 \times 3 \times 2}{100} \)
Let's calculate the simple interest step-by-step:
- Multiply the Principal, Rate, and Time: \( 2250 \times 3 \times 2 = 2250 \times 6 = 13500 \)
- Divide the result by 100: \( \frac{13500}{100} = 135 \)
So, the simple interest earned is Rs. 135.
| Parameter | Value |
|---|---|
| Principal (P) | Rs. 2250 |
| Rate (R) | 3% per annum |
| Time (T) | 2 years |
| Simple Interest (SI) | Rs. 135 |
Therefore, the interest earned on Rs. 2250 at the rate of 3% simple interest per annum for 2 years is Rs. 135.
Revision Table: Key Concepts in Simple Interest
| Term | Definition | Formula Symbol |
|---|---|---|
| Principal | The initial amount of money borrowed or invested. | P |
| Interest Rate | The percentage at which interest is charged or earned, usually per year. | R |
| Time | The duration for which the money is borrowed or invested. | T |
| Simple Interest | Interest calculated only on the principal amount. | SI |
| Amount | The total sum of principal and interest after a certain time. | A = P + SI |
Additional Information on Interest Types
While this question deals with simple interest, it's useful to know about another common type: compound interest.
- Simple Interest: Interest is calculated only on the original principal amount. The interest earned does not get added to the principal for future calculations.
- Compound Interest: Interest is calculated on the principal amount and also on the accumulated interest from previous periods. This means the interest 'compounds' over time, leading to faster growth in the total amount compared to simple interest for the same rate and time (when time is > 1 year).
Understanding the difference between simple and compound interest is crucial for financial calculations, especially concerning savings and loans over longer periods.
Similar Questions
A sum of money was invested at the rate of 7.5% simple interest per annuum for 4 years. If the investments were for 5 years, the interest earned would have been Rs. 375 more. What was the initial sum invested?
Rs. 750 invested for 3 months gave an interest of Rs. 18. What was the simple rate of interest per annum?
At 6% simple interest per annum a sum of money became Rs. 834 in \(6\frac{1}{2}\) years. The sum initially invested was:
At 5% simple interest per annum a certain sum yields a total amount of ₹2,790 at the end of 3\(\frac{1}{4}\) years. The sum invested was:
Saathi deposited Rs. 825 in a bank that promised 8% simple interest per annum. If Saathi kept the money with the bank for 5 years, she will earn an interest of:
- ₹ x invested at 9% simple interest per annum for 5 years yields the same interest as that on ₹ y invested at 7.5% simple interest per annum for 4 years. Find x ∶ y.
What will be the difference between the compound interest and simple interest on a sum of Rs. 100 at 10% per annum for 2 years?
A sum of money invested for 2 years and 9 months at the rate of 8% simple interest per annum became Rs. 732 at the end of the period. What was the sum that was initially invested?
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At 12% simple interest per annum a sum of money becomes Rs. 295 in \(1\frac{1}{2}\) years. What was the sum invested?
Important Questions from Simple Interest
How much time will it take for an amount of Rs. 450 to yield Rs. 81 as interest at 4.5% per annum of simple interest ?
Nirav and Mehul borrowed Rs.4000 and Rs.5000 respectively for 2.5 years at the rate of x% per annum. Mehul paid Rs 125 more interest than Nirav. Find x.
If the interest on a sum of Rs.1200 is more than the interest on Rs.1000 by Rs.120 in three years, then what is the rate of interest per annum?.
The difference between the simple interest received from two banks on Rs. 500 for two years is Rs. 2.50. What is the difference between their rates?
A sum of Rs.1200 becomes Rs.1560 at a rate of simple interest in 3 years. In how many years will the sum of Rs.800 amount to Rs.1120 at the same rate of simple interest?
