By depositing rupees 700 in the bank for a certain peroid of time at the fixed rate of simple interest per annum I got rupees 900 as principal along with interest write by calculating the amount to be deposited for which I would get rupees 1350 for the same time and at the same rate
Answers
Answer:
Answer:
hi
Step-by-step explanation:
Use the simple interest formula
Solve simple interest applications
Be prepared!
Before you get started, take this readiness quiz.
Solve 0.6y = 45. If you missed this problem, review Example 5.7.4.
Solve n1.45 = 4.6. If you missed this problem, review Example 5.7.5.
Use the Simple Interest Formula
Do you know that banks pay you to let them keep your money? The money you put in the bank is called the principal, P , and the bank pays you interest, I . The interest is computed as a certain percent of the principal; called the rate of interest, r . The rate of interest is usually expressed as a percent per year, and is calculated by using the decimal equivalent of the percent. The variable for time, t, represents the number of years the money is left in the account.
Definition: simple interest
If an amount of money, P , the principal, is invested for a period of t years at an annual interest rate r, the amount of interest, I , earned is
I=Prt
where
I = interest
P = principal
r = rate
t = time
Interest earned according to this formula is called simple interest.
The formula we use to calculate simple interest is I = Prt. To use the simple interest formula we substitute in the values for variables that are given, and then solve for the unknown variable. It may be helpful to organize the information by listing all four variables and filling in the given information.
Example 6.4.1
Find the simple interest earned after 3 years on $500 at an interest rate of 6%.
Solution
Organize the given information in a list.
I = ?, P = $500, r = 6%, t = 3 years
We will use the simple interest formula to find the interest.
Interest formulas mainly refer to the formulas of simple and compound interests. The simple interest (SI) is a type of interest that is applied to the amount borrowed or invested for the entire duration of the loan, without taking any other factors into account, such as past interest (paid or charged) or any other financial considerations. Simple interest is generally applied to short-term loans, usually one year or less, that are administered by financial companies. The same applies to money invested for a similarly short period of time. The simple interest rate is a ratio and is typically expressed as a percentage.
On the other hand, the compound interest is the interest which is calculated on the principal and the interest that is accumulated over the previous tenure. Thus, the compound interest (CI) is also called as “interest on interest”. It plays an important role in determining the amount of interest on a loan or investment. The formulas for both the compound and simple interest is given below.
Interest Formulas for SI and CI
The Interest formulas are given as,
Formulas for Interests (Simple and Compound)
SI Formula S.I. = Principal × Rate × Time
CI Formula C.I. = Principal (1 + Rate)Time − Principal
