Question:
( 3 of 10 ) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 6% simple interest?
(A) 11 19/46 days or 11.413 days
(B) 22 19/46 days or 22.413 days
(C) 46 days
(D) 23 days
You selected
$4000
Correct Answer
$4480
Solution And Explanation
Solution
Given,
Principal (P) = $4000
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) = $4000 × 6% × 2
= $4000 ×6/100 × 2
= 4000 × 6 × 2/100
= 24000 × 2/100
= 48000/100
= $480
Thus, Simple Interest = $480
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 = $4000 + $480
= $4480
Thus, Amount to be paid = $4480 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 = $4000
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 2 years
Thus, Amount (A)
= $4000 + ($4000 × 6% × 2)
= $4000 + ($4000 ×6/100 × 2)
= $4000 + (4000 × 6 × 2/100)
= $4000 + (24000 × 2/100)
= $4000 + (48000/100)
= $4000 + $480 = $4480
Thus, Amount (A) to be paid = $4480 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 $4000, the simple interest in 1 year
= 6/100 × 4000
= 6 × 4000/100
= 24000/100 = $240
Thus, simple interest for 1 year = $240
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $240 × 2 = $480
Thus, Simple Interest (SI) = $480
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $4000 + $480
= $4480
Thus, Amount to be paid = $4480 Answer
Similar Questions
(1) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $9768 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Joseph borrowed a sum of $3700 at 4% simple interest for 4 years.
(3) Calculate the amount due if Susan borrowed a sum of $3650 at 4% simple interest for 3 years.
(4) If Andrew paid $5760 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(5) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $11868 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Joshua borrowed a sum of $3950 at a 7% simple interest?
(7) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 10% simple interest.
(8) Find the amount to be paid if Patricia borrowed a sum of $5150 at 3% simple interest for 7 years.
(9) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 9% simple interest?
(10) What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 5% simple interest?