Question

What is simple interest annually?

Answer 1

Simple Interest is the method of calculating the interest amount for some principal amount.

The simple interest on the principal $P$ at a rate $R\%$ is $S.I=\frac{P\times R\times T}{100}$ …..(i).

Simple interest for a principal amount $P$ and interest rate $R$ calculated annually is,

Putting $T=1$in (i)

$S.I=\frac{Principal\times Rate\times Time}{100}$

$\Rightarrow$ $S.I=\frac{P\times R\times 1}{100}$

$\Rightarrow$ $S.I=\frac{P\times R}{100}$