<PRE><B>Question 433890</B>
A simple interest loan;
Time(T)= 5yrs, Rate(R)= 8%, Interest(I)= $400, Principal(P)= ?

{{{P=(I*100)/(R*T)}}} derived from the Simple Interest (SI) formula; {{{I=(P*R*T)/100}}}.

Thus {{{P=(400*100)/(8*5)}}} which is equal to 1000.
Therefore, the principal is $1,000.


Checking with the SI formula; {{{I=(P*R*T)/100}}}.
{{{I=(1000*8*5)/100}}} which is exactly equal to the interest in question ($400).</PRE>