Question:
What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 6% simple interest?
Correct Answer
$3752
Solution And Explanation
Solution
Given,
Principal (P) = $3350
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) = $3350 × 6% × 2
= $3350 ×6/100 × 2
= 3350 × 6 × 2/100
= 20100 × 2/100
= 40200/100
= $402
Thus, Simple Interest = $402
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 = $3350 + $402
= $3752
Thus, Amount to be paid = $3752 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 = $3350
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3350 + ($3350 × 6% × 2)
= $3350 + ($3350 ×6/100 × 2)
= $3350 + (3350 × 6 × 2/100)
= $3350 + (20100 × 2/100)
= $3350 + (40200/100)
= $3350 + $402 = $3752
Thus, Amount (A) to be paid = $3752 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 $3350, the simple interest in 1 year
= 6/100 × 3350
= 6 × 3350/100
= 20100/100 = $201
Thus, simple interest for 1 year = $201
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $201 × 2 = $402
Thus, Simple Interest (SI) = $402
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3350 + $402
= $3752
Thus, Amount to be paid = $3752 Answer
Similar Questions
(1) If Donna paid $5238 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(2) Lisa took a loan of $6100 at the rate of 6% simple interest per annum. If he paid an amount of $8662 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Patricia borrowed a sum of $5150 at 6% simple interest for 7 years.
(4) Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $10400 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if William borrowed a sum of $5500 at 7% simple interest for 8 years.
(6) Sandra took a loan of $6900 at the rate of 10% simple interest per annum. If he paid an amount of $11040 to clear the loan, then find the time period of the loan.
(7) Mary took a loan of $4100 at the rate of 10% simple interest per annum. If he paid an amount of $8200 to clear the loan, then find the time period of the loan.
(8) What amount does Jessica have to pay after 6 years if he takes a loan of $3750 at 4% simple interest?
(9) Charles took a loan of $5800 at the rate of 9% simple interest per annum. If he paid an amount of $9454 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if William borrowed a sum of $3500 at 7% simple interest for 4 years.