What is the formula for simple interest for 6 months?

Calculating Simple Interest for 6 Months

Simple interest is a straightforward method of calculating the interest earned on a loan or deposit over a fixed period. It is based on the initial principal amount, the interest rate, and the time duration.

Formula for Simple Interest for 6 Months

For a six-month period, the formula for calculating simple interest (SI) is given by:

SI = (P * r * t) / 100

where:

• P is the principal amount (initial amount borrowed or deposited)
• r is the interest rate (as a percentage)
• t is the time in months (in this case, 6)

Determining the Principal Amount (P)

In some cases, we may need to determine the principal amount (P) given the simple interest, rate, and time. For a six-month period, we can use the following formula:

P = (SI * 100 * 12) / (r * t)

Example

Let’s consider an example to understand how to use these formulas. Suppose we have a simple interest calculation with the following details:

• Simple interest (SI): $100
• Interest rate (r): 10% per year
• Time (t): 6 months

Calculating the Principal Amount (P)

Using the second formula, we can calculate the principal amount (P):

P = (100 * 100 * 12) / (10 * 6)
= (10000 * 12) / 60
= 2000

Therefore, the principal amount is $2000.

Calculating the Simple Interest (SI)

Using the first formula, we can calculate the simple interest (SI) for the six-month period:

SI = (2000 * 10 * 6) / 100
= (2000 * 60) / 100
= $120

Therefore, the simple interest earned over the six-month period is $120.