Find the interest on rs. 600 for 1year at the rate of 10 paise per rupee per month is
Answers
Answer:
Rs.720
Step-by-step explanation:
P = initial amount in Rupees = 600
R = rate of interest per cent per annum
T = time period in years = 1
Interest is 10 paise per rupee per month
=> Interest is 10 paise per 100 paise per month ...(100 paise = 1 rupee)
=> Interest is 10 per cent per month
=> Interest is 120 per cent per year ..(12 months = 1 year)
=> R = 120
SI = (P*R*T)/100
SI = 600*120*1/100
SI = 720
Answer: Interest is Rs.720
Some more explanation
As the time period is one year, it does not matter whether we are considering simple interest or compound interest. We know that when T = 1, simple interest equals compound interest. The following is a brief explanation.
SI = PRT/100
When T = 1,
SI = PR/100
CI = P(1 + R/100)^T - P
When T = 1,
CI = P(1 + R/100) - P
= P + PR/100 - P
= PR/100
= SI
Thus proved.