Question:
What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 7% simple interest?
Correct Answer
$4047
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 7% × 2
= $3550 ×7/100 × 2
= 3550 × 7 × 2/100
= 24850 × 2/100
= 49700/100
= $497
Thus, Simple Interest = $497
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 = $3550 + $497
= $4047
Thus, Amount to be paid = $4047 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 = $3550
Rate of Simple Interest (SI) or (R) = 7%
And, Time (t) = 2 years
Thus, Amount (A)
= $3550 + ($3550 × 7% × 2)
= $3550 + ($3550 ×7/100 × 2)
= $3550 + (3550 × 7 × 2/100)
= $3550 + (24850 × 2/100)
= $3550 + (49700/100)
= $3550 + $497 = $4047
Thus, Amount (A) to be paid = $4047 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 $3550, the simple interest in 1 year
= 7/100 × 3550
= 7 × 3550/100
= 24850/100 = $248.5
Thus, simple interest for 1 year = $248.5
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $248.5 × 2 = $497
Thus, Simple Interest (SI) = $497
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $497
= $4047
Thus, Amount to be paid = $4047 Answer
Similar Questions
(1) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 10% simple interest?
(2) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10212 to clear the loan, then find the time period of the loan.
(3) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $10430 to clear the loan, then find the time period of the loan.
(4) Barbara took a loan of $5100 at the rate of 8% simple interest per annum. If he paid an amount of $8772 to clear the loan, then find the time period of the loan.
(5) Joseph took a loan of $5400 at the rate of 8% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if William borrowed a sum of $5500 at 6% simple interest for 7 years.
(7) Calculate the amount due if Karen borrowed a sum of $3950 at 3% simple interest for 3 years.
(8) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 8% simple interest?
(9) Mary took a loan of $4100 at the rate of 7% simple interest per annum. If he paid an amount of $6970 to clear the loan, then find the time period of the loan.
(10) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 3% simple interest?