Question:
( 2 of 10 ) What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 7% simple interest?
(A) 258.39 km
(B) 215.33 km
(C) 172.26 km
(D) 137.81 km
You selected
$3800
Correct Answer
$4332
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 7% × 2
= $3800 ×7/100 × 2
= 3800 × 7 × 2/100
= 26600 × 2/100
= 53200/100
= $532
Thus, Simple Interest = $532
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 + $532
= $4332
Thus, Amount to be paid = $4332 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) = 7%
And, Time (t) = 2 years
Thus, Amount (A)
= $3800 + ($3800 × 7% × 2)
= $3800 + ($3800 ×7/100 × 2)
= $3800 + (3800 × 7 × 2/100)
= $3800 + (26600 × 2/100)
= $3800 + (53200/100)
= $3800 + $532 = $4332
Thus, Amount (A) to be paid = $4332 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 $3800, the simple interest in 1 year
= 7/100 × 3800
= 7 × 3800/100
= 26600/100 = $266
Thus, simple interest for 1 year = $266
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $266 × 2 = $532
Thus, Simple Interest (SI) = $532
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $532
= $4332
Thus, Amount to be paid = $4332 Answer
Similar Questions
(1) What amount will be due after 2 years if Paul borrowed a sum of $3850 at a 7% simple interest?
(2) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 10% simple interest?
(3) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $5984 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Patricia borrowed a sum of $5150 at 9% simple interest for 8 years.
(5) Calculate the amount due after 9 years if James borrowed a sum of $5000 at a rate of 9% simple interest.
(6) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $10400 to clear the loan, then find the time period of the loan.
(7) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 8% simple interest?
(8) Calculate the amount due if Susan borrowed a sum of $3650 at 8% simple interest for 4 years.
(9) Jennifer took a loan of $4500 at the rate of 8% simple interest per annum. If he paid an amount of $6660 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due after 10 years if Sarah borrowed a sum of $5850 at a rate of 3% simple interest.