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) Find the amount to be paid if Mary borrowed a sum of $5050 at 6% simple interest for 8 years.
(2) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 7% simple interest?
(3) If Daniel paid $4592 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(4) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.
(5) Matthew took a loan of $6400 at the rate of 8% simple interest per annum. If he paid an amount of $9984 to clear the loan, then find the time period of the loan.
(6) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 9% simple interest?
(7) Anthony had to pay $4558 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(8) Jessica took a loan of $5500 at the rate of 6% simple interest per annum. If he paid an amount of $8470 to clear the loan, then find the time period of the loan.
(9) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $7854 to clear the loan, then find the time period of the loan.
(10) Margaret took a loan of $6700 at the rate of 8% simple interest per annum. If he paid an amount of $9916 to clear the loan, then find the time period of the loan.