Simple Interest Calculation Explained
The question asks for the principal sum (P) that generates a specific simple interest (SI) over a given time period (T) at a certain annual interest rate (R).
Formula for Simple Interest
The formula for calculating Simple Interest is:
\( SI = \frac{P \times R \times T}{100} \)
Where:
- SI = Simple Interest
- P = Principal Sum
- R = Rate of Interest (per year)
- T = Time Period (in years)
Finding the Principal Sum (P)
We need to rearrange the formula to solve for P:
\( P = \frac{SI \times 100}{R \times T} \)
Applying Given Values
From the question, we have:
- SI = ₹480
- T = 2 years
- R = 12% per year
Substitute these values into the rearranged formula:
\( P = \frac{480 \times 100}{12 \times 2} \)
Calculation Steps
- Calculate the product of Rate and Time: \(12 \times 2 = 24\).
- Multiply the Simple Interest by 100: \(480 \times 100 = 48000\).
- Divide the result from step 2 by the result from step 1: \( P = \frac{48000}{24} \).
- Perform the division: \(P = 2000\).
Therefore, the principal sum required is ₹2000.
Similar Questions
- A sum of ₹ 2,000, invested at the rate of 8.5% simple interest per annum for 6 years will yield an interest of:
- ₹ $x$ invested at 9% simple interest per annum for 5 years yields the same interest as that on ₹ $y$ invested at 6.25% simple interest per annum for 8 years. Find $x : y$.
Important Questions from Simple Interest
If ₹12,800 is invested in a bank for 5 years at the rate of 9% per annum simple interest. what amount is returned by the bank?
Somu has borrowed ₹10,000 from a money lender with simple interest at a rate of 7% half yearly. How much amount will he pay to the money lender after 3 years?
Find the Simple interest on Rs. 2,400 from 20 March 2019 to 31 may 2019 at \(6{1 \over 4}\) % rate?
If the simple interest for five years is equal is 35% of the principal, that rate of interest is:
A sum fetched a simple interest of Rs. 3,040 at the rate of 8% p.a in 5 years. what is the sum?
