What is Simple Interest?
Simple interest is a method of calculating the interest charge on a loan or bill. Simple interest is determined by multiplying the interest rate by the principal by time which is normally in years (per annual) but could be in months, days, weeks etc during the specified time frame.
Simple Interest (S.I.) = (P x r x t) / 100
Where P stands for Principal, r stands for interest rate and t stands for time.
How to Solve and Apply Simple Interest.
There are a number of different reasons that could make one want to carry out a simple interest operation. One of them being that you want to lend money to your friend to start a business and you want your money to work for you and reproduce during the course of the loan.