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) Thomas took a loan of $5600 at the rate of 8% simple interest per annum. If he paid an amount of $8288 to clear the loan, then find the time period of the loan.
(2) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 5% simple interest for 8 years.
(3) Christopher took a loan of $6000 at the rate of 8% simple interest per annum. If he paid an amount of $9840 to clear the loan, then find the time period of the loan.
(4) How much loan did Linda borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5885 to clear it?
(5) Calculate the amount due if Jessica borrowed a sum of $3750 at 10% simple interest for 3 years.
(6) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9020 to clear the loan, then find the time period of the loan.
(7) Nancy took a loan of $6300 at the rate of 9% simple interest per annum. If he paid an amount of $10269 to clear the loan, then find the time period of the loan.
(8) Find the amount to be paid if Susan borrowed a sum of $5650 at 6% simple interest for 7 years.
(9) Calculate the amount due if Mary borrowed a sum of $3050 at 5% simple interest for 3 years.
(10) If Michael paid $3828 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.