Question:
What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 6% simple interest?
Correct Answer
$4200
Solution And Explanation
Solution
Given,
Principal (P) = $3750
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) = $3750 × 6% × 2
= $3750 ×6/100 × 2
= 3750 × 6 × 2/100
= 22500 × 2/100
= 45000/100
= $450
Thus, Simple Interest = $450
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 = $3750 + $450
= $4200
Thus, Amount to be paid = $4200 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 = $3750
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3750 + ($3750 × 6% × 2)
= $3750 + ($3750 ×6/100 × 2)
= $3750 + (3750 × 6 × 2/100)
= $3750 + (22500 × 2/100)
= $3750 + (45000/100)
= $3750 + $450 = $4200
Thus, Amount (A) to be paid = $4200 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 $3750, the simple interest in 1 year
= 6/100 × 3750
= 6 × 3750/100
= 22500/100 = $225
Thus, simple interest for 1 year = $225
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $225 × 2 = $450
Thus, Simple Interest (SI) = $450
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3750 + $450
= $4200
Thus, Amount to be paid = $4200 Answer
Similar Questions
(1) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $12420 to clear the loan, then find the time period of the loan.
(2) If Daniel paid $4756 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(3) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 9% simple interest.
(4) What amount does Patricia have to pay after 5 years if he takes a loan of $3150 at 4% simple interest?
(5) If Joshua paid $5684 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(6) Find the amount to be paid if Susan borrowed a sum of $5650 at 4% simple interest for 8 years.
(7) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 7% simple interest?
(8) 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.
(9) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $7616 to clear the loan, then find the time period of the loan.
(10) Susan took a loan of $5300 at the rate of 9% simple interest per annum. If he paid an amount of $8162 to clear the loan, then find the time period of the loan.