Simple Interest and Compound Interest Tips and Tricks for Government Exams

Introduction

• Interest
  When some one take up some money from other for the personal or commercial purpose we pay some additional money to him after a certain period of time is called Interest. So, we can also called this Interest as Simple Interest.
  
• Principal
  So, the concept of Principal is very simple. When money borrow for a certain time period called Principal or Sum.
• Amount
  The Addition of Simple Interest and Principal is called Amount.
  Amount (A) = Simple Interest (SI) + Principal (P).
  Simple Interest (SI) = Amount (A) – Principal (P).
• Per annual means
  Per annual means for a year.
  • Few general terms of Interest
  • P = Principal
  • R = Rate per annual
  • T = Number of years

Theory

• We try to provide all types of shortcut tricks on simple interest and compound interest here. Visitors are requested to carefully read all shortcut examples. These examples here will help you to better understand shortcut tricks on simple interest and compound interest.
• First of all do a practice set on math of any exam. Choose any twenty math problems and write it down on a page. Do first ten maths using basic formula of this math topic. You also need to keep track of the time. Write down the time taken by you to solve those questions. Now read our examples on simple interest and compound interest shortcut tricks and practice few questions. After finishing this do remaining questions using simple interest and compound interest shortcut tricks. Again keep track of timing. This time you will surely see improvement in your timing. But this is not enough. You need to practice more to improve your timing more.

Formula

1. SI = P x R x T/100 
2. Principal = Simple Interest × 100/ R × T
3. Rate of Interest = Simple Interest  × 100 / P × T
4. Time = Simple Interest × 100 / P × R
5. If the rate of Simple interest differs from year to year, then
   Simple Interest = Principal × (R₁+R₂+ R₃…..)/100
   • The four variables in the above formula are: SI = Simple Interest P = Principal Amount (This the amount invested)T = Number of years R = Rate of interest (per year) in percentage
   • A sum of money is divided into n parts in such a way that the interest on the first part at r₁% for t₁ years, on the second part at r₂% for t₂ years, on the third part at r₃% for t₃ years, and so on, are equal. Then the ratio in which the sum is divided in n part is: 1/r₁ × t₁ : 1/r₂ × t₂ : 1/r₃ × t₃  

Solved Examples