Question

How do you calculate simple interest in months?

Answer 1

Hint: Write the general formula of Simple interest and write the time period in years but in the terms of month to calculate simple interest in months. As in the general formula it is in years. Divide the number of months by $12$ and the formula will be obtained.

Formula used:
Standard formula of simple interest –
$S.I. = \dfrac{{P \times R \times T}}{{100}}$

Complete step by step solution: 
As we know that,
The standard formula to calculate the simple interest is,
$S.I. = \dfrac{{P \times R \times T}}{{100}}$
Where, $P = $Principal
$R = $Rate of interest
$T = $Time (in years)
If the time span is specified in months, divide the number of months by $12$ to convert months to years.
Therefore, the simple interest in months is
$S.I. = \dfrac{{P \times R \times N}}{{100 \times 12}}$
Here, $N$ is the number of months.

Note: The key concept involved in solving this problem is the good knowledge of simple interest. Students must remember that in simple interest, the interest is calculated on the same sum of money in each time period, so the interest to be paid or received is the same. Simple interest is earned when the interest on a sum borrowed for a specified period is calculated uniform