Simple Interest

 Simple Interest (S.I.) is a method used to calculate the interest amount on a principal sum of money. Imagine borrowing money from your siblings when your pocket money runs out, or lending them some when they need it. When you borrow money, you use it for your needs and repay it when you receive your next month's pocket money. This is a simple example of borrowing and lending at home.

 Simple Interest (SI) = Principal (P) × Rate (R) × Time (T) / 100. 

Personal Loans:

When you take out a personal loan from a bank or financial institution, the lender may charge simple interest on the loan amount. For instance, if you borrow $5,000 at an annual simple interest rate of 6% for 3 years, the interest you'll owe is calculated using the simple interest formula.

Savings Accounts:

 Some savings accounts offer simple interest on the deposited amount. If you deposit $1,000 in a savings account with an annual simple interest rate of 2%, after one year, you will earn interest based on that rate.