PUMPA - SMART LEARNING
எங்கள் ஆசிரியர்களுடன் 1-ஆன்-1 ஆலோசனை நேரத்தைப் பெறுங்கள். டாப்பர் ஆவதற்கு நாங்கள் பயிற்சி அளிப்போம்
Book Free DemoInterest is the amount of money that is paid for the use of borrowed money.
Let a person 'A' borrows some money from 'B' for a certain period of fixed time at a fixed rate, then 'A' will pay the borrowed money along with the additional money, which is called interest.
There are two types of interest:
- Simple interest
- Compound interest.
In this chapter, we are going to learn about Simple interest (I). Before that, we should learn some basic terms deals with interest.
- Principal
- Amount
- Time
Principal (P):
The money borrowed or lend out for a certain period is called the "principal" or the "sum".
Amount (A):
- The sum of the interest and principal is called the amount.
- \text{Amount (A)} = \text{Principal (P)} + \text{Interest (I)}.
Time (n):
The duration of the period for which the money is borrowed is called the time.
Rate Interest per Annum (r):
If interest is payable yearly for every 100 rupees, then it is called rate per cent per annum.
Rate is denoted by (r), and rate percentage is denoted by .
Interest is generally given in per cent for 1 year per annum. Suppose the bank gives an amount of ₹100 at an interest rate of ₹4, it is written as 4\% per year or per annum or in short 4\% p.a. (per annum).
It means on every ₹100 borrowed, ₹4 is the required interest to be paid for every one year.
Example:
Vijay takes a loan of ₹50000 at 5\% per year as the rate of interest. Let us find the amount he has to pay at the end of 1 year.
Sum borrowed = ₹50000.
Rate of interest = 5\% per year.
This means if ₹100 is borrowed, he has to pay ₹5 as interest. So, for the borrowed amount of ₹50000, the interest for one year would be:
= ₹2500.
So, at the end of 1 year, Vijay has to give an amount, which is the sum of principal and interest.
That is A = P + I = ₹ = ₹52500.
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