Question:
What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 6% simple interest?
Correct Answer
$4032
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 6% × 2
= $3600 ×6/100 × 2
= 3600 × 6 × 2/100
= 21600 × 2/100
= 43200/100
= $432
Thus, Simple Interest = $432
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 = $3600 + $432
= $4032
Thus, Amount to be paid = $4032 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 = $3600
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3600 + ($3600 × 6% × 2)
= $3600 + ($3600 ×6/100 × 2)
= $3600 + (3600 × 6 × 2/100)
= $3600 + (21600 × 2/100)
= $3600 + (43200/100)
= $3600 + $432 = $4032
Thus, Amount (A) to be paid = $4032 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 $3600, the simple interest in 1 year
= 6/100 × 3600
= 6 × 3600/100
= 21600/100 = $216
Thus, simple interest for 1 year = $216
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $216 × 2 = $432
Thus, Simple Interest (SI) = $432
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $432
= $4032
Thus, Amount to be paid = $4032 Answer
Similar Questions
(1) What amount does Thomas have to pay after 6 years if he takes a loan of $3800 at 10% simple interest?
(2) Mark took a loan of $6800 at the rate of 8% simple interest per annum. If he paid an amount of $12240 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due after 10 years if Charles borrowed a sum of $5900 at a rate of 8% simple interest.
(4) Lisa took a loan of $6100 at the rate of 8% simple interest per annum. If he paid an amount of $9516 to clear the loan, then find the time period of the loan.
(5) Sarah took a loan of $5700 at the rate of 7% simple interest per annum. If he paid an amount of $9690 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Thomas borrowed a sum of $3800 at 10% simple interest for 3 years.
(7) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 9% simple interest?
(8) If James paid $3600 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(9) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 5% simple interest for 4 years.
(10) Calculate the amount due after 9 years if Jennifer borrowed a sum of $5250 at a rate of 9% simple interest.