SIMPLE INTEREST

Simple Interest obtained on each investment Also, if rate (R) changes from R1
SI is nothing but the fixed percent- where interest rates are R1, R2, to R2 and time (T) changes from
age of the principal (invested/bor- R3, .....Rn respectively and time T1 to T2 but principal (P) is fixed,
rowed/amount of money). periods are T1, T2, T3, .....Tn re- then change in
spectively, then the ratio in
which the amounts are in- P
Some key words S.I. =  R1T1 – R 2 T2 
vested is : 100
 Principal (P) : It is the sum of
money deposited/loaned e.t.c. 1111 6. If a certain sum of money P
:::....
also known as “Capital”. 100RT100RT100RT100RT
 112233nn    lent out at S.I. amounts to A1
3. If a certain sum of money be- in T1 years and to A2 in T2 years,
 Interest : It is the money paid
comes n times itself in T years then
by the borrower, calculated on
the basis of Principal. at simple interest, then the A1T2 – A2T1
 Time (T/n) : This is the dura- rate of interest per annum is P=
T2 – T1
tion for which money is lent/ 100 n – 1
borrowed. R % A1 – A 2
T
Rate of Interest (r/R) : It is the and, R =

4. I f a cer ta i n sum of money A 2 T1 – A1T2 ×100
rate at which the interest is
charged on principal. becomes n times itself in T 7. If a sum P1 lent at simple interest
y ea rs a t a simple i nterest, rate of R1% per annum and an-
Amount (A) = Principal + Inter-
then the time T in which it other sum P2 at simple interest
est
will become m times itself is rate of R2% per annum, then the
Some Basic Formulae given by rate of interest for the whole
 Simple Interest (SI): sum is :
m – 1
PRT T' = T
SI  n – 1  P1R1  P2R 2 
100 R =  
5. Effect of change of P, R and T on  P1  P2 
P = Principal, r = rate of inter- simple interest is given by the
est (in %) following formulae : 8. When there is a change in
t = time period (yearly, half principal (P), rate (R) and time
Change in Simple Interest
yearly etc.) (T), then the value of simple
Product of fixed parameters interest (I) also changes and is
prt = × given by
100
 Amount (A) = P + SI = P  =P
100 [difference of variable param- I1 P × R1 × T1
eters] = 1
I2 P2 × R 2 × T2
 rt  For example, if rate (R) changes
1  
 100  from R1 to R2 and P and T are A1 – P1 P1  R1  T1
fixed, then  A – P  P  R T
Some Useful Short-cut Methods : 2 2 2 2 2
PT I1 =A1 – P1 and I2 = A2 – P2
1. If a certain sum in T years at R  R1 – R 2 
n

Change in S.I. =
% per annum amounts to Rs. 100 1
A, then the sum will be Similarly, if principal (P) changes 9. Out of a certain sum P, part is
a
from P1 to P2 and R and T are fixed,
100  A 1
P = 100  (R  T) then change in invested at R1%, part at R2%
b
and the remainder
2. If a certain sum is invested in RT
 P1 –P2   1 1 1
n types of investments in such S.I. = 1 – –  say part at R3%. If
100  a b c
a manner that equal amount is

Simple Interest
 Since, the increased time is 4 100
two years therefore the extra x2 =
9
interest would be (2 ×r)% of the
20 2
sum (where r is the rate of in- x= =6
terest) 3 3
Thus, the required rate of
Now,
We can conclude that (2×r)%= 4% 2
interest is 6 %
3
\ r = 2%
the annual income from all 5. If the simple interest on Rs.
these investments is Rs A, 3. A man deposits Rs. 1350 in a
bank at 5% per annum and Rs. 1350 be more than the inter-
then the original sum is given est on Rs. 1250 by Rs. 20 in 2
by 1150 in another bank at 6% per
years, find the rate percent per
annum. Find the rate of inter-
annum.
  est for the whole sum.
 A  100  (a) 5% (b) 10%
  (a) 5.40% (b) 6.40%
P =  R1 R 2 R 3  (c) 6% (d) 8%
    (c) 5.46% (d) 111%
 a b c  (e) None of these
(e) None of these
Sol. (b) 1250 + 100
1. A Sum of Rs. 4000 is lent for 5 Sol. (c) Here the ratio of invest-
years at the rate of 15% per ments is 1350 : 1150 = 27 : 23
annum. Find the interest. Now, using Alligation method 2 years 20
1 year 10
(a) Rs. 3000 (b) Rs. 2000 Bank I Bank II
5% 6% 10
(c) Rs. 1000 (d) Rs. 1500 R= × 100
100
(e) None of these
x = 10%
P  R T 27 23 Alternate
Sol. (a) S.I = Where x is the rate of
100 We know that Rs. 20 is the interest
interest for the whole sum. for 2 years on the sum (1350–1250)
P  4000 = Rs. 100
5  27  6  23
R  15% Now, x = Hence, the required rate of In-
(27  23)
T  5 years 20 100
(135  138) 273 terest = = 10%
100  2
= =
4000 15  5 50 50 6. If the simple interest on Rs.
So, S.I. = = Rs.3000 = 5.46% 375 increases by Rs. 75, when
100
4. The simple interest on a sum the rate % increases by 5% per
Alternate annum. Find the time.
4
of money is of the principal, (a) 2 years (b) 8 years
Here, r = 15% 9
and the number of years is equal (c) 4 years (d) 9 years
t = 5 years
to the rate per cent per annum. (e) None of these
Therefore the interest will be Find the rate per cent. Sol. (c) Here the extra interest = Rs.
(15×5) = 75% of the sum
2 3 75
(a) 6 % (b) 5 % 75 Rate = 100  20% of
4000  75 3 5 375
Thus, Interest = the sum.
100
2 1 Now, we have 5 × t = 20
= Rs. 3000 (c) 7 % (d) 6 %
3 3
20
2. If the simple interst on Rs. 625 (e) None of these \ t= = 4 years
.in

5
increases by Rs. 25 when the Sol. (a) From the given statement 7. What annual installment will
time increases by 2 years. Find in the question part we can discharge a debt of Rs. 4,200
the rate percent per annum. conclude that ratio of sum due in 5 years at 10% simple
(a) 2% (b) 3% and interest is 9: 4. interest?
(c) 1% (d) 0.5% and, Rate % = Time = x (a) Rs. 700 per year
(e) None of these In the above case interest is (b) Rs. 350 per year
Sol. (a) Here, the extra interest x2 % of the sum i.e. (c) Rs. 750 per year
 25  9 x2 (d) Rs. 650 per year

 100 
 = 4% of the sum. = =4
 625  100 (e) None of these

Simple Interest
 Sol. (a) Extra Interest = 4 × 3 = 12%
200
\ t= = 25 years
8 600
Hence, sum = ×100
9. A certain sum is invested for a 12
certain time period. It amounts = Rs. 5000
to Rs. 400 at 10% per 12. A certain sum of money
annum.But when invested at amounts to Rs. 550 in 3 years
4% per annum, it amounts to and to Rs. 650 in 4 years. Find
Sol. (a) Installment = Rs. 200. Find the time. the sum.
Principal ×100 (a) 100 years (b) 75 years (a) Rs. 250 (b) Rs. 300
100 × t + (t n–1 + t n–2 + t n–3......+)× R% (c) 50 years (d) 60 years (c) Rs. 150 (d) Rs. 350
(e) None of these (e) None of these
P = 4200
Sol. (c) Assume Time = T years Sol. (a) Amount for 3 years
T = 5 years
According to the question, = Rs. 550
R% = 10%
Amount for 4 years = Rs.650
then According to the question  10t 
1  100 
P   = 400 .......(i) SI for 1 year = Rs.100
Installment   Then, SI for 3 years = 300
4200 100  4t  Therefore, sum 550 – 300
= 100  5  (4  3  2  1)10 1  100 
P  = 200 ......(ii) Sum = Rs. 250
 
13. A sum was put at SI at a
From (i) and (ii) certain rate for 4 years. Had it
4200 100
= = Rs. 700 100 + 10t = 200 + 8t been put at 5% lower rate, it
600
2t = 100 would have fetched Rs. 100
8. In what time does a sum of less. Find the sum.
t = 50 years
money become thrice at the (a) Rs. 500 (b) Rs. 5000
simple interest rate of 8% per 10. Ramesh borrows Rs.7000 from
(c) Rs. 400 (d) Rs. 4000
annum? a bank a fter 3 y ea rs he
returns Rs.3000 and after 5 (e) None of these
(a) 30 years (b) 15 years years by returning Rs.5450 Sol. (a) Accoding to the question,
(c) 20 years (d) 25 years closes the account. Find the Rs. 100 is (4 × 5=) 20% of the
(e) None of these rate of interest : sum.
times (a) 5 % (b) 4% 100 100
Hence, sum = = Rs. 500
Sol. (d) T = n–1 ×100 (c) 2% (d) 6% 20
R Sol. (a) Actual P = Rs.7000 14. Anish borrowed Rs. 15000 at
3 –1 Total money returned the rate of 12% and another
= × 100
8 = Rs.8450 amount at the rate of 15% for
2 S.I. = Rs.1450 two years. The total interest
= × 100 = 25 years SI of 3 years on 7000 will be paid by him was Rs. 9000. How
8
Equal to SI of 1 year on 21000 much did he borrow?
Alternate SI of 2 years on 4000 will be (a) Rs. 32000 (b) Rs. 33000
Here, the ratio of the sum and the Equal to SI of 1 year on 8000 (c) Rs. 30000 (d) Rs. 63000
amount is 1: 3 Therefore, the ratio 21000 + 8000 = 29000
of the sum and the interest would (e) None of these
be 1 : 2 29000  R  1 Sol. (b) Here,
Now, we have = 1450
100
Amount = 3 x 15  2
R=5% 15000 12  2 + = 9000
Principal = 1 100
100
11. A sum was put on SI at a
Interest = 2
certain rate for 3 years. Had it
Rate = 8% 3
been put at 4% higher rate, it 3600 + x = 9000
Time = ? would have fetched Rs. 600 10
2  more, Find the sum. (9000 – 3600)10
Note that the interest is  1 100  (a) Rs. 5000 (b) Rs. 4000
x =
3
 
= 200% of the sum. (c) Rs. 6000 (d) Rs. 3000 5400 10
Now, we get 8 × t = 200 (e) None of these = = Rs. 18000
3

Simple Interest
 Exercise

interest for 4 years. If the 10. Pawan has ` 8000. He lent out
interest on first part is thrice ` 2,000 at 5% per annum `
that of the second part, find the 2,500 at 10% per annum and
difference between two parts– the remaining at r% per
1. ` 3600 was lent out on simple (a) ` 5,000 (b) ` 4,800 annum. He found that he got a
return of 8% on the whole
1 (c) ` 6,000 (d) ` 4,200
interest at 6 % per annum. amount. Find the value of r.
4 6. Rohit deposited 12,600 in a
What will be the amount after bank at 8% per annum and ` 1 2
(a) 8 % (b) 8 %
4,200 at 6% per annum in an- 3 7
1 other bank. After one year at
2 years? 2
3 what effective rate did he get (c) 8 %
his return on the whole amount
5
(a) ` 525 (b) ` 4,025
(d) None of these
(c) ` 4,125 (d) ` 4,000 he invested?
2. Praveen deposited ` 5,000 in a (a) 7% (b) 8.25% 1
11. Rakesh Yadav lent out his
post office on 5th January 1999. (c) 7.5% (d) 7.75% 3
And he withdraw the total 7. A certain amount becomes `
amount on 31 st May of the 2
1200 in 6 years and `1350 in 9 amount at 7% per annum
same year. How much interest 5
years at certain rate of simple
will he receive at 5% rate of interest. Find the rate of amount at 10% per annum and
simple interest? the rest at 12% per annum. If after
simple interest-
(a) ` 125 (b) ` 100 two year his income is `1430 find
(c) ` 112.5 1 5 the amount he lent out :
(a) 5 % (b) 5 % (a) 8,000 (b) 7500
(d) None of these 2 9
(c) 7200
3. Rakesh Yadav took ` 7500 loan
at a certain rate of simple in- 1 (d) None of these
(c) 6 %
terest per annum and ` 4500 4 12. `19400 is divided into two parts.
at 1% more. After three years (d) None of these First part is lent out at 8% per
he paid `1575 as simple inter- annum for 5 years and the
8. A certain amount becomes `
est. Find at what rate did he other part is lent out at 4% per
30,000 in 8 years. If the simple
take ` 4500 loan? annum for 9 years. If the ratio
interest is half of the principal
amount, find the rate of inter- of simple interest recieved on
1 2 two parts is 3 : 7. Find the
(a) 6 % (b) 6 % est and the amount.
4 3 amount of second part :
(c) 5% (d) 6% 1 (a) ` 5,400 (b) `14000
(a) 6 % , 24,000
4. Bhuvnesh lent out ` 10800. A 4 (c) ` 9700
part of the amount was lent at (b) 6%, 20,000 (d) None of these
8% per annum and rest at 10% 13. An amount of `18600 is divided
rate of simple interest per an- 1
(c) 6 % , 20,000 into three parts and these parts
num. If after two years he has 4 are lent out for 2 years, 4 years
gained ` 1908 as interest, find and 5 years respectively. If the
the sum of money on two dif- 2
(d) 6 % , 20,000 rate of simple interest is 10%
ferent Rates he lent out. 3
p.a., then the amount of all 3
(a) ` 6300, 4500 9. A certain amount becomes ` parts become same. Find the
(b) ` 4500, 6300
n

three parts :
1
(c) ` 4000, 6800 11600 at 7 % per annum in 6 (a) ` 5, 600, ` 6,000, ` 7,000
(d) ` 6800, 4000 2
(b) ` 4500, ` 6400, ` 7700
5. ` 12000 was divided into two years. How much would be the (c) ` 7,000, ` 6,000, ` 5600
parts and first was lent out at amount if it was lent out at 10% (d) ` 7700, ` 6400, ` 4500
8% per annum rate of simple for 6 years?
interest for 5 years and the 14. Three sums x, y and z are such
(a) ` 12,000 (b) ` 14,400 that y is simple interest of x and
other part was lent out at 10%
per annum rate of simple (c) ` 13960 (d) ` 12,800 z is the simple interest of y. If

Simple Interest
 19. Bhuvnesh took a loan of ` 7000 will be equal to the interest of
at simple interest. And further
took a loan of ` 3000 after 3 1
Rs.1400 at 2 % per annum
years. After 5 years of second 2
loan he paids Rs.4615 as inter- for 4 years?
est and closed his account. Find (a) ` 100 (b) ` 960
the rate of interest.
(c) ` 740 (d) ` 800
(a) 5.5% (b) 6.5%
25. A certain amount becomes
in both the conditions time (c) 7.5% (d) 7.15%
20. A certain amount was taken as 29
and rate of interest are same times at simple interest. If
then find a relation between x, loan at 6% per annum loan. In 25
the first year Rs.6800 was paid the numerical value of
y and z.
back and the rest money was interest rate and time be the
(a) z2 = xy (b) x2 = yz charged with 5% p.a. . If the same, find the rate of interest.
(c) y2 = xz (a) 4% (b) 5%
11
(d) None of these interest for second year is (c) 5.5% (d) 4.5%
15. Shiv lent out a certain sum at 20
26. A certain amount becomes
5% per annum and 6 months of the interest of Ist year, then
Rs.3000 in 5 years. If the
later he lent out the same sum find the amount taken
on loan. simple interest received is
at 6% per annum. After a cer- one-fourth of the amount find
tain time shiv got Rs. 4600 to- (a) ` 20,000 (b) ` 17,000
the rate of interest and the
tal amount from each. How (c) `17500 (d) `16000
amount.
much money did he lend each 21. A certain amount at certain
time? rate of simple interest for (a) 5%, ` 2500
(a) ` 4200 (b) ` 4000 certain time gives a certain (b) 6%, ` 2400
(c) ` 3600 (d) ` 3800 interest. The amount is (c) 5%, ` 2600
increased by 20%, rate is made
16. A man bought a bike and paid (d) None of these
Rs.15,000 instantly. He prom- 2 27. A certain amount becomes
ised that he would pay the rest of the previous and time is
3 1
money in two years 13920 with ` 3000 at 4% per annum in 6
interest and the rate of inter- 6 4
est being 8%. Find the cost of made of the previous. In this years. What will be amount at
5
the bike. way the simple interest 2 1
6 % per annum in 5
(a) 30,000 (b) 25,000 received is ` 2400. What was 3 2
(c) 28920 (d) 27,000 the interest received in the years?
17. Bhuvnesh lent out a certain first condition? (a) ` 3600 (b) ` 3050
amount at 6% per annum for 2 (a) ` 3,000 (d) ` 24,00
(c) ` 3080 (d) ` 3280
years and another at 7% per (c) ` 2500
28. Bhuvnesh deposited ` 8000 in
annum for the same time and (d) None of these
a bank and ` 4500 in the next
after the completion of the 22. ` 30,000 is paid back in three
year. If after 5 years he received
period. He got ` 2478 as annual installments. If the
interest. If one-fourth of the interest on the rest of the ` 3480 as simple interest, find
first amount is equal to one- money at 4% added to each the rate of interest.
fifth of the second amount. Find installment, find all three 1
installments. (a) 7.5% (b) 6 %
the total amount he lent out– 4
(a) ` 19900 (b) ` 19100 (a) 11200 1
(c) ` 18900 (d) ` 18100 (b) 11200, 10400, 10200 (c) 6% (d) 5 %
2
(c) 11200, 10800, 10400
18. Rohit lent out a certain amount 29. Jitu has ` 20,000 out of which
for some years. He lent it at 7% (d) None of these he lends ` 4000 at 7% per
per annum for the first 3 years, 23. A certain amount becomes 4 annum, ` 6000 at 8% per
n

at 9% for the next 4 years and times at 8% per annum. At annum, 5000 at 10% per
for the rest time at 4% per an- what rate it will become 10 annum and the remaining at
times in the same time?
num. If at the end of 12 years r%. If after calculation he get
he got ` 2772 as simple inter- (a) 25% (b) 27.5% to know that he had gained
est on the amount, find the (c) 24% (d) 30% 12% income on the whole
amount he lent out. 24. The interest of what amount at amount, find the value of r.
(a) ` 3,000 (b) ` 4,000 (a) 20% (b) 25%
1
(c) ` 3500 (d) ` 3600 5% per annum for 3 years (c) 22.8% (d) 24%
2

Simple Interest
 Kareena received `1458 more (a) 200 (b) 450
than that of Rakesh. Find the (c) 350 (d) 250
difference of rates at which both 39. I lent out a certain amount at
lent out the money. certain rate of simple interest
(a) 3% (b) 5% for certain time and I got ` 1250
(c) 2.5% as interest. If I lent out 40%
(d) Can’t be determind 4
more amount for time at
7
30. Rakesh Yadav had ` 25000 out 1
35. Manoj lent out ` 5650 for 3 3
of which he lent out some 2 rate of interest, what would
amount at 8% and remaining years at simple interest and 2
at 11%. After four year he got be my interest received?
after the completion of time he
Rs.9080 as interest. Find the (a) 2000 (b) 1000
received an amount of ` 6441.
amount lent out at each rate– (c) 1750 (d) 1500
If he increases the rate of
(a) 9000 at 8%, 16000 at 11% 40. ` 44900 is divided among four
interest he will get ` 8418.50.
(b) 12500 at 8%, 12500 at 11% Find how much he increases people. If they pay equal
(c) 15000 at 18%, 1000 at 11% the rate of interest ? amount (principal amount +
(d) 16000 at 8%, 9000 at 11% (c) 8% (b) 14% interest) after 2 years, 4 years,
31. Bhuvnesh took a loan of Rs. 6 years and 10 years at 10% per
(c) 9% (d) 10%
10,000 from his friend at 12% annum rate of simple interest.
per annum rate of simple in- 36. X lent out a part of ` 22000 to Y
Find the difference of the
terest for 5 years. He gave his and the rest to Z. The ratio of
maximum and the minimum
friend a watch and a camera as rates at which he lent to X and
share they received.
interest. The cost of these two Y was 4 : 5 and the ratio of time
(a) ` 17665.57 (b) ` 21600
articles is in the ratio of
1 1 (c) ` 5600 (d) ` 8600
7 : 23. Find the cost of the was 2 : 3 If both paid the
camera 2 2 41. Bhuvnesh took a loan of
(a) ` 6900 (b) ` 3450 same interest, find the amount 1
(c) ` 4600 (d) ` 4400 taken on loan by each of them. ` 50,000 at 6 % per annum for
2
32. Radha lent out some money at (a) 8,000, 14,000
8.37%. Per annum rate of three years. And he also lent
(b) 14000, 8000
1 (c) 10, 000, 12,000 1
simple interest for 2 years. out ` 60,000 at 7% for 3
2 (d) 12,000, 10,000 2
She calculated that had she 37. Parveen divided ` 44000 in two years. In this way whatever he
given it at 1.37% less, she would parts and lent out to two persons earned he invested it on
have received ` 6850 less. What at 7% and 10% for 4 years and 2 purchaing a Fan, a table and a
amount he lent out? years respectively. The interest calculater the costs of which
(a) 1,00, 000 (b) 2,40,000 received by them was in the were in ratio 28 : 15 : 7. Find
(c) 2,00,000 (d) 1,40,000 ratio 4 : 5 How many rupees did the cost of the fan, the table,
33. Rakesh Yadav and Bhuvnesh parveen lend ro first person? and the calculater each.
invested ` 5400 and ` 7200 for (a) 16000 (b) 22000 (a) ` 2800,` 1500, ` 700
4 years and 3 years (c) 28000 (b) ` 2872, ` 1515, ` 707
respectively. If the total simple (c) ` 2727, ` 1439, ` 639
(d) None of these
interest received by both of them
is ` 3456 and the rate charged 38. ` 2250 was divided into two (d) ` 2772, ` 1485, ` 693
by them is in the ratio of 3 : 5, At parts and first was lent out at 42. ` 33220 was divided among
what rate Bhuvnesh invested three friends. If after 4 years 5
1 years and 10 years respectively
the money. 4 % per annum for 3 years
n

(a) 6% (b) 7.5% 2 they paid same interest

(c) 10% (d) 12.5% while the other at 6% per amount, interest rate being 7%
34. Rakesh Yadav and Kareena per annum, Find the share of
4
lent out ` 14400 and ` 16200 annum for 1 years. It same each of them.
5 (a) 6040, 12080, 15100
3 interest is received in both the
for 3 years and 3 years (b) 15100, 12088, 6040
8 investments. Find the
respectively at simple interest. difference between two parts (c) 15100, 12080, 6004
After the completion of time. lent out. (d) None of these

Simple Interest