Krish wants to buy a house for Rs. 30,00,000 but does not have enough savings, so he must take out a loan. A loan is money borrowed from a lender like a bank that must be paid back with additional interest. Simple interest is calculated using the principal amount, interest rate, and time period, with the formula: Simple Interest = Principal * Rate * Time / 100. The document provides examples of calculating simple interest on various loans to explain the concept.

1. SIMPLE INTEREST
HUMERA SHAIKH
Tilak College of Education,
Pune

2. INTRODUCTION
 Story:
Krish wants to purchase a house of Rs. 30,00,000. But don’t
have such a big amount with him. He doesn’t have enough
savings to buy the house. What will he do? Can you suggest?
 Ask a friend to lend some money…..
 Go to the bank for a loan…..

3. Q- What is a loan?
Terms used :
Loan
Lender
Borrower

4. SIMPLE INTEREST
Definition:
When at the time of returning the Loan to the
Bank, we have to pay back an amount
somewhat bigger than the Borrowed Loan
amount. This additional amount is called as
Simple Interest.

5. Factors of Simple Interest :
Principle Amount
Rate of Interest
Time (Period) in Years

6. FORMULA
 Simple Interest:
 SI= P* R* N
100
Where,
P= Principal Amount (Rupees)
R= Rate of Interest (per cent per annum) (p.c.p.a)
N= No. of period (Years)
SI= Simple Interest (Rupees)

7. EX 1: FIND SIMPLE
INTEREST
 Principal = Rs. 5000/ Rate of interest= 8p.c.p.a
 No. of years= 3 years
 Simple Interest= _______
 SI= P*R*N
100
= 5000*8*3
100
SI = 1200/- Ans: Simple Interest= Rs 1200/-

8. EX 2:FIND SIMPLE INTEREST
Jenny lends Rs 300 to her friend who needs
to pay the School Picnic fees. Her friend
promised to pay her the amount with 12%
interest in 3months. How much will be the
interest?

9. RECAP
What do you mean by Loan ?
What are the factors of Simple Interest ?
What is the formula to calculate Simple
Interest?

10. APPLICATION:
FIND OUT
THE SIMPLE INTEREST
Example
Principal (Rs.)
Rate of
Interest
(p.c.p.a)
No. of years Simple
Interest
(Rs.)
1
9000
10
3
2
1500
4
10
months
3
20000
15
2

11. ASSIGNMENT
‘ Collect some Newspaper cutouts
where you can find information on
Loan or Interest.’

12. THANK YOU
FOR
YOUR KIND ATTENTION
AND
CO-OPERATION!!!!!