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) How much loan did Stephanie borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $9060 to clear it?
(2) If Mary paid $3294 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(3) How much loan did John borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6500 to clear it?
(4) Calculate the amount due if Robert borrowed a sum of $3100 at 6% simple interest for 3 years.
(5) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 9% simple interest?
(6) Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $10472 to clear the loan, then find the time period of the loan.
(7) In how much time a principal of $3200 will amount to $3392 at a simple interest of 2% per annum?
(8) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 9% simple interest?
(9) Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $11180 to clear the loan, then find the time period of the loan.
(10) Mary took a loan of $4100 at the rate of 7% simple interest per annum. If he paid an amount of $6109 to clear the loan, then find the time period of the loan.