SIMPLE INTEREST

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Interest is the extra money that a bank gives you for saving or depositing your
money with them.

Similarly, when anybody borrows money, they pay interest.

In simple interest, the interest is calculated on the same amount of money in

each time period, therefore, the interest earned in each time period is the
same.

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 Basic Formulae

Principal × Rate × Time

1 Simple interest =
100

Simple Interest × 100

2 Principal =
Rate × Time

Simple Interest × 100

3 Rate of Interest =
Principal × Time

Simple Interest × 100

4 Time =
Principal × Rate

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 If Rate of Interest Differs From Year to Year Then

Principal × (R1 + R2 + R3 + ⋯ )
1 Simple interest =
100
100 + (Rate × Time)
2 Amount = Principal ×
100

100
3 Principal = Amount ×
100 + (Rate × Time)

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 Short Tricks

100 × Amount
1 Relationship between Principal and amount is given by sum = .
100 + rt

2 If a sum of money becomes n times in t years at a m−1

simple interest then the time in which it will amount to t years.
n−1
m times itself is given by

3 Two equal amounts of money are deposited at r1% and Id × 100

r2% for t1 and t2 years respectively. If the difference
r1 t1 − r2 t 2
between their interests is Id then sum is given by

A sum of money is divided into n parts in such a way 1 1 1 1

4 that the interest on the first part at r1% for t1 years, on : : ……..:
r1 ×t1 r2 ×t2 r3 ×t3 rn ×tn
second part at r2% for t2 years, on third part at r3% for t3
years and so on, are equal. Then the ratio in which the
sum is divided in n parts is

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5 If a sum of money becomes n1 times in t1 years and n2 times in n1 − 1 n2 − 1
=
t2 years at simple interest rate then. t1 t2

If a person deposits Rs.x1 in a bank at r1% per annum and Rs.x2 x1 r1 + x2 r2

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at r2% per annum then the rate of interest for the whole sum is x1 + x 2

When principal changes from P1 to P2 then SI1-SI2 is given by (P1 − P2 ) × r × t

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100

8 When rate changes from R1 to R2 then SI1-SI2 is given by P × (R1 − R 2 ) × t

100

A certain sum is invested for a certain time. It amounts to Rs. A1 A1 −A2

9 [ ]× 100 years
at r1% per annum. But when invested at r2% per annum it A2 r1 −A1 r2
amounts to Rs. A2 then time is given by

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10 A certain sum is invested for a certain time. It amounts to Rs. A2 r1 − A1 r2
[ ]
A1 at r1% per annum. But when invested at r2% per annum it r1 − r2
amounts to Rs. A2 then sum is given by

If a certain sum of money amounts to Rs. A1 in t1 years and to A2 t1 − A1 t 2

11 ]
Rs. A2 in t2 years then sum is given by t1 − t 2

The time in which a sum of money becomes n times itself at r% n−1

12 ( ) × 100
per annum simple interest is given by r

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If a simple interest on a certain sum P is I and the number of 100×I
years is equal to the rate percent per annum then the rate [ ]
P
percent or time is given by

If a borrower has to pay at r% simple interest per annum for t 100

14 [1 + ]
years and simple interest is given as Rs. I then the amount is rt
given by I

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15 On Rs.P1 invested at simple interest rate r1 percent per annum, I2 P1
Rs.I1 is obtained as interest in certain years. In order to earn × × r1 %
I1 P2
Rs.I2 as interest on Rs.P2 in the same number of years the rate
of simple interest is given by
A1
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A certain sum of money amounted to Rs.A1 at r1% in a time in Rs.[ r A r ]
which Rs.P amounted to Rs.A2 at r2%. If the rate of interest is 1−r1 +( Pr
2 1)
2 2
simple then the sum is given by

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1 Find the simple interest on Rs.2000 for 7 months at 5 paise per rupee per month.

SOLUTION

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2 If the simple interest on Rs.12000 be more than the simple interest on Rs. 10000 by Rs.500 in
3years then rate percent per annum.

SOLUTION

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3 At simple interest a sum of Rs.64 becomes Rs.83.20 in 2 years. What will Rs. 86
becomes in 4 years at the same rate?

SOLUTION

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4 The simple interest on a certain sum of money for 2 years at 8 % per annum is Rs.560.
Find the sum.

SOLUTION

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5 Simple interest on a certain sum at a certain annual rate of interest is 9/16 of the sum. If the
numbers representing rate percent and time in years be numerically equal then find the rate
percent per annum

SOLUTION

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6 Simple interest on a certain sum at a certain annual rate of interest is 25/16 of the sum.
If the numbers representing rate percent and time in years be numerically equal then
find the rate percent per annum.

SOLUTION

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7 Rs.800 amount to Rs.956 in 3 years at a certain rate of simple interest. If the rate of interest is
increased by 4% what will be the amount of Rs.800 in 3 years?

SOLUTION

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8 When the rate of interest in a bank is reduced from 5% to 4% a man deposits Rs.2000 more
and his annual income remains the same. Find the original deposit.

SOLUTION

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9 Two equal sums were lent out at 7% and 5% S.I., respectively. The interest earned
on the two loans adds up to Rs.960 for 4 years. Find the total sum lent out.

SOLUTION

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10 Arun lends Rs.20000 to two of his friends. He gives Rs.12000 to the first at 8% p.a.
simple interest. Arun wants to make a profit of 10% on the whole. Find the simple
interest rate at which he should lend the remaining sum of money to the second friend

SOLUTION

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11 A person invests money in three different schemes for 6 years, 10 years and 12 years at
10%, 12% and 15% simple interest respectively. At the completion of each scheme he
Gets the same interest. Find the ratio of his investment.

SOLUTION

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 Nitin borrowed some money at the rate of 6% per annum for the first three years, 9% per
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Annum for the next 5 years and 13% per annum for the period beyond 8 years. If the total
interest paid by him at the end of 11 years is Rs.8160. find the money borrowed by him.

SOLUTION

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 Ramesh deposited Rs.15600 in a fixed deposit at the rate of 10% per annum simple interest.
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After every second year he adds his interest earning to the principal. Find the interest at the
end of fourth year.

SOLUTION

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 A person lends 40% of his sum of money at 15% per annum, 50% of rest at 10% per
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annum and the rest at 18% per annum rate of interest. What would be the annual rate
of interest if the interest is calculated on the whole sum?

SOLUTION

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15 If a man receives on one fourth of his capital 3% interest, on two-third 5% and on the
remainder 11% find the percentage he receives on the whole?

SOLUTION

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16 Rs.12000 is divided into two parts so that the simple interest on the first part for 3
years at 12% per annum may be equal to the simple interest on the second part for
4.5 years at 16% per annum. Find the ratio of the first part to the second part.

SOLUTION

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17 In a certain time the ratio of certain principal and the simple interest obtained from I
are in the ratio 10: 3 at 10% interest per annum. Find the number of years for which
the money was invested.

SOLUTION

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18 Ratio of the principal and the amount after 1 year is 10: 12. Find the rate of interest per
annum.

SOLUTION

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19 A person lent Rs.5000 partly at the rate of 4% and partly at the rate of 5% p.a. simple
interest. The total interest after 2 years is Rs.440. To find the sum of money lent at
each of the above rates Rs.5000 is divided in what ratio.

SOLUTION

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20 At what rate of simple interest per annum will a sum become 7/4 of itself in 4 years?

SOLUTION

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21 A certain sum of money becomes 3 times of itself in 20 years at simple interest. In how many
years does it become double of itself at the same rate of simple interest?

SOLUTION

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22 A sum of money at a certain rate per annum of simple interest doubles in the 5 years and at a
different rate becomes 3 times in 12 years. Find the lower rate of interest.

SOLUTION

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23 Rs.6000 becomes Rs.7200 in 4 years at a certain rate of simple interest. If the rate
becomes 1.5 times of itself, find the amount of the same principal in 5 years.

SOLUTION

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24 A person who pays income tax at the rate of 4 paisa per rupee, finds that a fall of
interest rate from 4% to 3.75% diminishes his net yearly income by Rs.48. what is his
capital?

SOLUTION

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25 A sum of money was invested at a certain rate of simple interest for 2 years. Had it
been invested at 1% higher rate, it would have fetched Rs.24 more interest. Find the
sum of money?

SOLUTION

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26 What sum of money must be given as simple interest for 6 months at 4% per annum in
order to earn Rs.150 interest?

SOLUTION

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27 If the annual rate of simple interest increases from 10% to 12.5% a man’s yearly
income increases by Rs.1250. find his principal(in rupees).

SOLUTION

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28 In what time will the simple interest be 2/5 of the principal at 8% per annum?

SOLUTION

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29 A man took a loan from a bank at the rate of 12% per annum at simple interest. After
3 years he had to pay Rs.5400 as interest only for the period. Find the principal amount
borrowed by him.

SOLUTION

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30 Find the sum lent at 5% per annum simple interest that produces interest of Rs. 2 per day.

SOLUTION

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31 Rs.500 was invested at 12% per annum simple interest and a certain sum of money invested at
10% per annum simple interest. If the sum of the interest on both the sum after 4 years is
Rs.480. find the latter sum of money.

SOLUTION

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32 A sum of money lent at simple interest amount to Rs. 880 in 2 years and to Rs.920 in 3 years.
Find the sum of money (in rupees)

SOLUTION

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33 Mohan lent some amount of money at 9% simple interest and an equal amount of
money at 10% simple interest each for two years. If his total interest was Rs.760, what
amount was lent in each case?

SOLUTION

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34 If the simple interest for 6 years be equal to 30% of the principal, it will be equal to the
principal after how many years?

SOLUTION

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35 Find the rate of interest per annum at which the total simple interest of a certain
capital for 1 year is equal to the total simple interest of the same capital at the rate of
5% per annum for 2 years.

SOLUTION

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36 A sum of Rs.1750 is divided into two parts such that the interests on the first part at
8% simple interest per annum and that of the other part at 6 % simple interest per
annum are equal. Find the interest on each part.

SOLUTION

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37 The simple interest on a certain sum for 8 months at 4% per annum is Rs.129 less than
the simple interest on the same sum for 15 months at 5% per annum. Find the sum.

SOLUTION

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38 A sum of Rs.1500 is lent out in two parts in such a way that the simple interest on one
part at 10% per annum for 5 years is equal to that on another part at 12.5% per
annum for 4 years. Find the sum lent out at 12.5%.

SOLUTION

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39 In how many years will the simple interest on a sum of money be equal to the principal at the
rate of 16% per annum?

SOLUTION

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40 Equal sum of money are lent to X and Y at 7.5% per annum for a period of 4 years and 5 years
respectively. If the difference in interest paid by them was Rs.150 then find the sum lent to
each?

SOLUTION

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