1. Principal:The money borrowed or lent out for a certain period is called the
principal or the sum.
2. Interest: Extra money paid for using other's money is called interest.
3. Simple Interest (S.I.) : If the interest on a sum borrowed for a certain period is reckoned uniformly, then it is called simple interest.
Let Principal = P, Rate = R % per annum (p.a.) and Time = T years. Then,
(i) S.I. = (P × R × T ) / 100
(ii) P = (100×S.I)/(R×T) ;
R = (100×S.I)/(P×T)
T = (100×S.I)/(P×R)
