Question

What is the simple interest on a loan?

Answer 1

The simple interest on a loan is the interest charged on a principal amount of the loan.

If you borrow money, you have to return the simple interest in addition to the principal loan amount.

Formula:

$\mathrm{Simple}\mathrm{Interest}=\frac{P\times R\times T}{100}$

Where,

$P=$ Principal amount

$R=$ Rate of interest

$T=$ Time period in year