Question:
If Michael borrowed $3300 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
Correct Answer
$3498
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 3%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $3300 × 3% × 2
= $3300 ×3/100 × 2
= 3300 × 3 × 2/100
= 9900 × 2/100
= 19800/100
= $198
Thus, Simple Interest = $198
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 = $3300 + $198
= $3498
Thus, Amount to be paid = $3498 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 = $3300
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 2 years
Thus, Amount (A)
= $3300 + ($3300 × 3% × 2)
= $3300 + ($3300 ×3/100 × 2)
= $3300 + (3300 × 3 × 2/100)
= $3300 + (9900 × 2/100)
= $3300 + (19800/100)
= $3300 + $198 = $3498
Thus, Amount (A) to be paid = $3498 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $3300, the simple interest in 1 year
= 3/100 × 3300
= 3 × 3300/100
= 9900/100 = $99
Thus, simple interest for 1 year = $99
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $99 × 2 = $198
Thus, Simple Interest (SI) = $198
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $198
= $3498
Thus, Amount to be paid = $3498 Answer
Similar Questions
(1) How much loan did Jacob borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $10000 to clear it?
(2) What amount does Christopher have to pay after 5 years if he takes a loan of $4000 at 6% simple interest?
(3) Calculate the amount due if Jessica borrowed a sum of $3750 at 9% simple interest for 3 years.
(4) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $6705 to clear the loan, then find the time period of the loan.
(5) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10010 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 9% simple interest?
(7) How much loan did Jacob borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $9200 to clear it?
(8) If Mary paid $3294 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(9) Calculate the amount due if Jessica borrowed a sum of $3750 at 4% simple interest for 4 years.
(10) Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 8% simple interest.