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**Simple Interest & Compound Interest**

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**IMPORTANT POINTS ON INTEREST**

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**Simple Interest:**

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**Compound Interest:**

**FORMULAE :**

**Example 1.**Calculate the simple interest on Rs7200 for 4 years at 6.25% p.a. rate.

**Solution :**Simple Interest = 25% of 7200 = Rs. 1800

**Example 2**Rate is 10% p.a., Time is 4 years, What is the simple Interest on a loan of Rs. 1000.

**Solution:**Simple Interest = 40% of Rs. 1000 = Rs 400

**Example 3**A sum becomes 2.6 times in 8 years at simple rate. Find the rate.

**Solution:**The Rate is x 100 = 20%, because the rate is the interest on Rs. 100 in one year.

**Example 4.**A sum becomes 3 times in 8 years at simple rate. When does it become 5 times?

**Solution:**Let the P = Rs. 1

**Example 5.**What sum amounts to Rs 6400 in 4 years at 3.75% p.a. simple rate.

**Example 6.**A sum becomes Rs. 1200 after 2 years & Rs. 1320 after 3 years at simple rate. Find the rate.

**Example 7**.Simple interest of 2 years = Rs. 600. Find the compound interest on the same sum at 20% p.a. rate.

**Example 8 .**What sum amounts to Rs. 9261 in 3 years at 5% p.a. compound interest.

**Example 9**.A sum becomes times in 2 years at compound rate. Find the rate.

**Solution:**Since the sum becomes 25/4 times after 2 years.

**Example 10.**For how many years should Rs. 600 be invested at 10% per annum in order to earn the same simple interest as earned by investing Rs. 800 at 12% per annum for 5 years?

**Solution:**Simple Interest = Rs. = Rs. 480

**Other Quants Notes:**