SOLVING INTEREST RATES AND SIMPLE INTEREST QUESTIONS

SOLVING INTEREST RATES AND SIMPLE INTEREST QUESTIONS

Hello and welcome everyone, In this video, I will show you:-
1- what is the Rate of Interest or interest rate and how can you quickly solve its questions?
2- What are Simple Interest and explanation and formulae to solve its questions?

An interest rate is a fee that you are charged for borrowing for a certain period of time. The interest amount is paid in percentage (%). The rate of Interest is some percentage of the principal amount paid by the borrower to the lender of the money.
Example-

Principal Amount = Rs. 10000
Time Period = 1 year
Rate of Interest = 5%

I = 5% of 10000

= 5/100 * 10000
= 500
Amount = 10000 + 500 (Where 10000 is the Princial Amount
and I stands for interest rate)
= 15000
So, 500 is the interest that the person has paid to the lender.

Simple interest-

To calculate we require:

1: Principal Amount (P)
2: Rate of Interest (R)
3: Time (T)

Formula = (P*R*T)/100

Example -

Que- Find the simple interest on Rs. 200 at 5% per anum for 2.5 years also find the amount paid?

Soln. - Here

P = 200
R% = 5%
T = 2.5 years

SI = (P*R*T)/100
= (200*5*2.5)/100
SI = 25 Rs.

Amount Paid = P + SI
= 200 + 25
= 225 Rs.

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