Question:
What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 6% simple interest?
Correct Answer
$3920
Solution And Explanation
Solution
Given,
Principal (P) = $3500
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) = $3500 × 6% × 2
= $3500 ×6/100 × 2
= 3500 × 6 × 2/100
= 21000 × 2/100
= 42000/100
= $420
Thus, Simple Interest = $420
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 = $3500 + $420
= $3920
Thus, Amount to be paid = $3920 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 = $3500
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3500 + ($3500 × 6% × 2)
= $3500 + ($3500 ×6/100 × 2)
= $3500 + (3500 × 6 × 2/100)
= $3500 + (21000 × 2/100)
= $3500 + (42000/100)
= $3500 + $420 = $3920
Thus, Amount (A) to be paid = $3920 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 $3500, the simple interest in 1 year
= 6/100 × 3500
= 6 × 3500/100
= 21000/100 = $210
Thus, simple interest for 1 year = $210
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $210 × 2 = $420
Thus, Simple Interest (SI) = $420
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3500 + $420
= $3920
Thus, Amount to be paid = $3920 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 10% simple interest per annum. If he paid an amount of $10640 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Thomas borrowed a sum of $3800 at 2% simple interest for 4 years.
(3) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 7% simple interest.
(4) Daniel took a loan of $6200 at the rate of 7% simple interest per annum. If he paid an amount of $9238 to clear the loan, then find the time period of the loan.
(5) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 9% simple interest.
(6) Jessica took a loan of $5500 at the rate of 7% simple interest per annum. If he paid an amount of $8580 to clear the loan, then find the time period of the loan.
(7) Karen took a loan of $5900 at the rate of 6% simple interest per annum. If he paid an amount of $8024 to clear the loan, then find the time period of the loan.
(8) Calculate the amount due if Charles borrowed a sum of $3900 at 9% simple interest for 3 years.
(9) Michael had to pay $3696 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(10) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $10600 to clear the loan, then find the time period of the loan.