Simple Interest Calculation: Finding the Principal Sum
The question asks for the principal sum (P) that earns a simple interest (I) of ₹480 over a period (T) of 2 years at an annual interest rate (R) of 16%.
Applying the Simple Interest Formula
The formula for simple interest is:
\( I = \frac{P \times R \times T}{100} \)
Where:
- I = Simple Interest = ₹480
- P = Principal Sum (what we need to find)
- R = Rate of Interest per year = 16%
- T = Time period in years = 2 years
Rearranging the Formula to Solve for Principal (P)
To find the principal sum (P), we rearrange the formula:
\( P = \frac{I \times 100}{R \times T} \)
Calculating the Principal Sum
Substitute the given values into the rearranged formula:
\( P = \frac{480 \times 100}{16 \times 2} \)
First, calculate the denominator:
\( 16 \times 2 = 32 \)
Now, calculate the numerator:
\( 480 \times 100 = 48000 \)
Finally, divide the numerator by the denominator:
\( P = \frac{48000}{32} \)
\( P = 1500 \)
Therefore, the sum that will earn an interest of ₹480 in 2 years at 16% simple interest is ₹1500.
Similar Questions
The simple interest on ₹1,280 at 5% p.a. in 3 years is:
A invests ₹8000 and B invests ₹11000 at the same rate of simple interest per annum. If at the end of 3 years, B gets ₹720 more interest than A, then find the rate of simple interest per annum.
A sum of money lent on simple interest becomes \(7\over5\) of itself in 4 years. Find the rate of interest per annum.
What sum will earn a simple interest of ₹480 in 3 years at a 16% per year rate of interest?
Find the simple interest of ₹3,000 as a sum borrowed at a 4% per year rate of interest for 5 years.
- 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?
- How long will it take for ₹1,500 to become ₹2,040 at a rate of 8% per annum simple interest?
- What sum (in ₹) will earn an interest of ₹480 in 2 years at 12% simple interest per year?
- What sum (in ₹) will earn an interest of ₹480 in 2 years at 8% simple interest per year?
- What sum (in ₹) will earn an interest of ₹460 in 4 years at 5% simple interest per year?
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?
