Question:
If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
Correct Answer
$3276
Solution And Explanation
Solution
Given,
Principal (P) = $3150
Rate of Simple Interest (SI) = 2%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% per annum.
Method (1) Using Formula
Calculation of Simple Interest
Formula to Calculate Simple Interest
Simple Interest (SI) = Principal × Rate × Time
Thus, Simple Interest (SI) = $3150 × 2% × 2
= $3150 ×2/100 × 2
= 3150 × 2 × 2/100
= 6300 × 2/100
= 12600/100
= $126
Thus, Simple Interest = $126
Calculation of Amount
The total money paid to the lender by a borrower is called the Amount.
In other words, sum of priciple and interest is called the Amount.
Formula to Calculate the Amount
Amount = Principal + Interest
Thus, Amount = $3150 + $126
= $3276
Thus, Amount to be paid = $3276 Answer
Method (2)
Calculation of Amount when Principal, Rate of Simple Interest and Time are given
Calculation of Amount directly using Principal, SI, and Time
Formula to calculate the Amount
Amount (A) = Principal (P) + Principal(P) × Rate of Interest (SI) × Time (t)
⇒ A = P + PRT
Here in the question, P = $3150
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 2 years
Thus, Amount (A)
= $3150 + ($3150 × 2% × 2)
= $3150 + ($3150 ×2/100 × 2)
= $3150 + (3150 × 2 × 2/100)
= $3150 + (6300 × 2/100)
= $3150 + (12600/100)
= $3150 + $126 = $3276
Thus, Amount (A) to be paid = $3276 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest in 1 year = $2
∴ For $1, the simple interest in 1 year = 2/100
∴ For $3150, the simple interest in 1 year
= 2/100 × 3150
= 2 × 3150/100
= 6300/100 = $63
Thus, simple interest in 1 year = $63
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $63 × 2 = $126
Thus, Simple Interest (SI) = $126
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3150 + $126
= $3276
Thus, Amount to be paid = $3276 Answer
Similar Questions
(1) Find the amount to be paid if David borrowed a sum of $5400 at 4% simple interest for 8 years.
(2) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 3% simple interest.
(3) Find the amount to be paid if Michael borrowed a sum of $5300 at 10% simple interest for 8 years.
(4) How much loan did Susan borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6780 to clear it?
(5) If Steven paid $4968 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(6) In how much time a principal of $3150 will amount to $3402 at a simple interest of 2% per annum?
(7) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 2% simple interest.
(8) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7616 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Michael borrowed a sum of $5300 at 7% simple interest for 8 years.
(10) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9774 to clear the loan, then find the time period of the loan.