**Hello friends,**

**We have already discussed in our previous article**

**titled “**

**Understanding the concept of Compound Interest and Formula**”

**about compound interest .**Today we will discuss about simple interest. But mind it, we will not talk about simple interest formula.

**We want to figure out an easy way of solving Simple Interest problems in which the amounts after ‘a’ and ‘b’ years respectively are given and you are asked about the Principal Amount and Rate of Simple Interest. You are given four pieces of data:**

**I. No. of Years ‘a’**

**II. Amount after ‘a’ years**

**III. No. of Years ‘b’**

**IV. Amount after ‘b’ years**

Obviously, to solve this kind of problem, we should know the basics of simple interest.

We usually apply simple interest formula to solve these kinds of questions, form equations, solve them at the same time to find principal amount and simple interest and then apply another simple interest formula to find the rate of interest. However, there is an easier and quicker method.

###
**Here is a sample question.**

**Question:-**A sum of money at SI amounts to Rs. 550 in 5 years and Rs. 600 in 6 years. What is the Principal and the Rate of Interest?

**Solution:**We know that simple interest is same for all the years. So we find the difference in the number of years and the amounts.

The difference in amounts = Rs. 600 – Rs. 550 = Rs. 50

∴ Simple Interest = Rs. 50/ 1 year = Rs. 50/ year

∴ SI for 6 years = 50 × 6 = 300

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