Question

❄️Hey mates
❥︎Question :

What is simple intrest ? how to caculate it ? Give one example.

✔️should not scam and spam
✔️Quality solution needed

Good luck :) ​

Answer 1

Simple interest represents a fee you pay on a loan or income you earn on deposits.

How to Calculate It:

In the following example, the term "simple" means you're working with the simplest way of calculating interest. Once you understand how to calculate simple interest, you can move on to other calculations, such as annual percentage yield (APY), annual percentage rate (APR), and compound interest.

$100 x .05 x 3 = $15 simple interest for three years

Answer 2

Required Answer:

What is simple interest?

The interest which is calculated on the principal directly and doesn't include intrest on intrest is called simple interest.

It is usually applied on short term loans- days, weeks, months or a few years but not for a long time. It is the most common way of interest.

How to calculate simple interest?

Simple interest can be calculated by applying following formula:

$:\implies\underline{\boxed{\sf Simple\: Intrest=\dfrac{P\times R\times T}{100} }}\bigstar$

Here:-

• P refers to Principal, which is the amount which is borrowed or lended.

• R refers to Rate of interest.

• T refers to time, which is the time for which principal is deposited in a bank, lended or borrowed.

Example of simple interest:-

• It is usually calculated on short term loans such as buying automobiles, retail ínstallment, home loans etc.

Important terms:-

• Borrower→ A person who recieves money from a person or organisation and promise to repay it after a certain period of time is called borrower.

• Lender → A person or organisation who gives Money to someone who needs money but will repay it and had to pay it with Intrest is called lender.