Question

Find the interest on Rs. 1200 at 6% per annum for 1 year.

Answer 1

Hint : You can use the formula of simple interest as the values of principal, rate of interest and time period are already given. Substitute these values in the equation of simple interest and find the interest for one year.

Complete step-by-step answer:

Simple interest is a type of interest that applies to the amount borrowed or invested for the entire duration of the loan. The simple interest rate is a ratio and is typically expressed in percentage.
Simple interest is important because it plays a major role in determining the amount of interest on a loan or investment.
Here in this question we need to find the interest, where,
Principal = Rs. 1200
Rate of interest, R = 6%
Time period is given as 1 year.
Principal is the amount which is borrowed or invested. The interest rate represents a ratio of the principal, i.e. Rs. 1200 borrowed or invested. The interest rate is expressed in percentage as 6%.
The loan period or duration is the time that the principal amount is either borrowed or invested.
\[\therefore \]Interest = Principal \[\times \] Rate of Interest \[\times \] Time Period
\[\begin{align}
  & I=PRT \\
 & I=\dfrac{1200\times 6\times 1}{100} \\
\end{align}\]= Rs. 72
Therefore, interest on Rs. 1200 at 6% per annum for 1 year is Rs. 72.
Note:
If we were asked to find the final amount, including interest after 1 year, then use this formula, where A is the final amount.
\[A=P\left( 1+rt \right)=1200\left( 1+\dfrac{6\times 1}{100} \right)\]= Rs. 1272.
Or else we can find the amount by adding principal and interest.
\[A=P+I=1200=72\]= Rs. 1272.