Question:
What amount will be due after 2 years if John borrowed a sum of $3100 at a 6% simple interest?
Correct Answer
$3472
Solution And Explanation
Solution
Given,
Principal (P) = $3100
Rate of Simple Interest (SI) = 6%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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) = $3100 × 6% × 2
= $3100 ×6/100 × 2
= 3100 × 6 × 2/100
= 18600 × 2/100
= 37200/100
= $372
Thus, Simple Interest = $372
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 = $3100 + $372
= $3472
Thus, Amount to be paid = $3472 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 = $3100
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3100 + ($3100 × 6% × 2)
= $3100 + ($3100 ×6/100 × 2)
= $3100 + (3100 × 6 × 2/100)
= $3100 + (18600 × 2/100)
= $3100 + (37200/100)
= $3100 + $372 = $3472
Thus, Amount (A) to be paid = $3472 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3100, the simple interest in 1 year
= 6/100 × 3100
= 6 × 3100/100
= 18600/100 = $186
Thus, simple interest for 1 year = $186
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $186 × 2 = $372
Thus, Simple Interest (SI) = $372
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $372
= $3472
Thus, Amount to be paid = $3472 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 2% simple interest.
(2) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 7% simple interest?
(3) Lisa took a loan of $6100 at the rate of 6% simple interest per annum. If he paid an amount of $9760 to clear the loan, then find the time period of the loan.
(4) Donna had to pay $5432 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(5) Mary took a loan of $4100 at the rate of 9% simple interest per annum. If he paid an amount of $6314 to clear the loan, then find the time period of the loan.
(6) Joshua had to pay $5488 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(7) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 4% simple interest.
(8) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 2% simple interest.
(9) Calculate the amount due after 9 years if Linda borrowed a sum of $5350 at a rate of 4% simple interest.
(10) If Charles borrowed $3900 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.