Quant Study Notes (Tricks): Simple Interest

              

Simple Interest

→ The principal in case of S.I is always same at the beginning of every year.

→ The principal for C.I was increasing constantly. The interest earned each year was added on to the principal at the end of that year and the resultant was the principal for the next year.

Total S.I. in n year = Interest in 1 year × number of years.

Or S.I. = rn% of P

From here you can also conclude that simple interest is an application of percentage.

⇒ If principal halves, rate doubles and number of years become thrice, the S.I. will become =(1/2)×2×3 = thrice  

→ The annual payment that will discharge a debt of Rs. P due in T years at R% per annum-

Ex. Find out the annual installment that will discharge a debt of Rs. 12,900 due in 4 years at 5% per annum simple interest.

Here P = 12,900

T = 4, R = 5%