Question:
What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 6% simple interest?
Correct Answer
$4256
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 6% × 2
= $3800 ×6/100 × 2
= 3800 × 6 × 2/100
= 22800 × 2/100
= 45600/100
= $456
Thus, Simple Interest = $456
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 = $3800 + $456
= $4256
Thus, Amount to be paid = $4256 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 = $3800
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $3800 + ($3800 × 6% × 2)
= $3800 + ($3800 ×6/100 × 2)
= $3800 + (3800 × 6 × 2/100)
= $3800 + (22800 × 2/100)
= $3800 + (45600/100)
= $3800 + $456 = $4256
Thus, Amount (A) to be paid = $4256 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 $3800, the simple interest in 1 year
= 6/100 × 3800
= 6 × 3800/100
= 22800/100 = $228
Thus, simple interest for 1 year = $228
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $228 × 2 = $456
Thus, Simple Interest (SI) = $456
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $456
= $4256
Thus, Amount to be paid = $4256 Answer
Similar Questions
(1) Calculate the amount due if Sarah borrowed a sum of $3850 at 10% simple interest for 3 years.
(2) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $7872 to clear the loan, then find the time period of the loan.
(3) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 6% simple interest?
(4) In how much time a principal of $3000 will amount to $3120 at a simple interest of 2% per annum?
(5) If Joshua paid $5292 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(6) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 3% simple interest.
(7) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 6% simple interest?
(8) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $7140 to clear the loan, then find the time period of the loan.
(9) What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 5% simple interest?
(10) Find the amount to be paid if Robert borrowed a sum of $5100 at 5% simple interest for 8 years.