Question:
What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 7% simple interest?
Correct Answer
$3762
Solution And Explanation
Solution
Given,
Principal (P) = $3300
Rate of Simple Interest (SI) = 7%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 7% simple interest means, Rate of Simple Interest (SI) is 7% 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) = $3300 × 7% × 2
= $3300 ×7/100 × 2
= 3300 × 7 × 2/100
= 23100 × 2/100
= 46200/100
= $462
Thus, Simple Interest = $462
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 = $3300 + $462
= $3762
Thus, Amount to be paid = $3762 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 = $3300
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 2 years
Thus, Amount (A)
= $3300 + ($3300 × 7% × 2)
= $3300 + ($3300 ×7/100 × 2)
= $3300 + (3300 × 7 × 2/100)
= $3300 + (23100 × 2/100)
= $3300 + (46200/100)
= $3300 + $462 = $3762
Thus, Amount (A) to be paid = $3762 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 7%
This, means, $7 per $100 per year
∵ For $100, the simple interest for 1 year = $7
∴ For $1, the simple interest for 1 year = 7/100
∴ For $3300, the simple interest in 1 year
= 7/100 × 3300
= 7 × 3300/100
= 23100/100 = $231
Thus, simple interest for 1 year = $231
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $231 × 2 = $462
Thus, Simple Interest (SI) = $462
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $462
= $3762
Thus, Amount to be paid = $3762 Answer
Similar Questions
(1) Find the amount to be paid if Michael borrowed a sum of $5300 at 10% simple interest for 7 years.
(2) Robert took a loan of $4200 at the rate of 10% simple interest per annum. If he paid an amount of $6720 to clear the loan, then find the time period of the loan.
(3) Find the amount to be paid if Jessica borrowed a sum of $5750 at 4% simple interest for 7 years.
(4) If Robert paid $3348 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(5) Calculate the amount due if Barbara borrowed a sum of $3550 at 9% simple interest for 3 years.
(6) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $8316 to clear the loan, then find the time period of the loan.
(7) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $10780 to clear the loan, then find the time period of the loan.
(8) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $8268 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Sarah borrowed a sum of $3850 at 9% simple interest for 3 years.
(10) Find the amount to be paid if Thomas borrowed a sum of $5800 at 9% simple interest for 8 years.