Simple Interest Calculation: Finding the Principal Sum
To find the principal sum (the initial amount of money) that earns a specific interest, we use the simple interest formula.
Given Information:
- Interest Earned (I): ₹480
- Time Period (T): 2 years
- Annual Interest Rate (R): 8%
Simple Interest Formula:
The formula for simple interest is:
\( I = \frac{P \times R \times T}{100} \)
Where:
- \(I\) = Simple Interest
- \(P\) = Principal Sum (the amount we need to find)
- \(R\) = Rate of Interest per year
- \(T\) = Time period in years
Calculating the Principal (P):
We need to rearrange the formula to solve for \(P\):
\( P = \frac{I \times 100}{R \times T} \)
Now, substitute the given values into the rearranged formula:
\( P = \frac{480 \times 100}{8 \times 2} \)
Perform the calculation:
- Multiply the interest by 100: \(480 \times 100 = 48000\)
- Multiply the rate by the time: \(8 \times 2 = 16\)
- Divide the result from step 1 by the result from step 2: \(P = \frac{48000}{16}\)
- \(P = 3000\)
Conclusion:
The principal sum that will earn an interest of ₹480 in 2 years at 8% simple interest per year is ₹3000.
Similar Questions
The simple interest on ₹1,280 at 5% p.a. in 3 years is:
- How long will it take for ₹1,500 to become ₹2,040 at a rate of 8% per annum simple interest?
- A sum of ₹1,250 amounts to ₹1,550 in 4 years. What is the simple interest rate?
- What will be the simple interest on ₹1,450 invested for 5 years at a rate of 5% pa?
- A sum of ₹1,250 amounts to ₹1,550 in 4 years. What is the simple interest rate?
- What will be the simple interest on ₹ 1,450 invested for 5 years at a rate of 5% pa?
- 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 $x : y$.
- Reeta invests a certain sum of money at a certain rate of simple interest per annum, and the interest she gets is equal to one-fourth of the sum invested. If the time period (in years) of investment is equal to the percentage rate of interest per annum, for how many years did Reeta invest the sum of money?
In what duration will a sum of money double itself at 10% per annum rate of simple interest?
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.
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?
P borrowed an amount from Q at a simple interest of 10% p.a. At the end of the year, P paid back Rs 99000 which was 90% of what she owed. How much money did P borrow?
An amount becomes Rs. 3795 in 3 years and Rs. 4537.50 in \(7 \frac{1}{2}\) years on simple interest. Find the rate of interest per annum.
