Question:
What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 5% simple interest?
Correct Answer
$4015
Solution And Explanation
Solution
Given,
Principal (P) = $3650
Rate of Simple Interest (SI) = 5%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3650 × 5% × 2
= $3650 ×5/100 × 2
= 3650 × 5 × 2/100
= 18250 × 2/100
= 36500/100
= $365
Thus, Simple Interest = $365
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 = $3650 + $365
= $4015
Thus, Amount to be paid = $4015 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 = $3650
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 2 years
Thus, Amount (A)
= $3650 + ($3650 × 5% × 2)
= $3650 + ($3650 ×5/100 × 2)
= $3650 + (3650 × 5 × 2/100)
= $3650 + (18250 × 2/100)
= $3650 + (36500/100)
= $3650 + $365 = $4015
Thus, Amount (A) to be paid = $4015 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $3650, the simple interest in 1 year
= 5/100 × 3650
= 5 × 3650/100
= 18250/100 = $182.5
Thus, simple interest for 1 year = $182.5
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $182.5 × 2 = $365
Thus, Simple Interest (SI) = $365
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $365
= $4015
Thus, Amount to be paid = $4015 Answer
Similar Questions
(1) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $7560 to clear the loan, then find the time period of the loan.
(2) Christopher took a loan of $6000 at the rate of 8% simple interest per annum. If he paid an amount of $9360 to clear the loan, then find the time period of the loan.
(3) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $13300 to clear the loan, then find the time period of the loan.
(4) What amount does Linda have to pay after 5 years if he takes a loan of $3350 at 5% simple interest?
(5) Michael took a loan of $4600 at the rate of 9% simple interest per annum. If he paid an amount of $7498 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if William borrowed a sum of $5500 at 3% simple interest for 8 years.
(7) Charles took a loan of $5800 at the rate of 8% simple interest per annum. If he paid an amount of $9512 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 7 years.
(9) If Kenneth paid $5400 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(10) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 4% simple interest?