Question:
What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 8% simple interest?
Correct Answer
$4118
Solution And Explanation
Solution
Given,
Principal (P) = $3550
Rate of Simple Interest (SI) = 8%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 8% simple interest means, Rate of Simple Interest (SI) is 8% 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 × 8% × 2
= $3550 ×8/100 × 2
= 3550 × 8 × 2/100
= 28400 × 2/100
= 56800/100
= $568
Thus, Simple Interest = $568
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 + $568
= $4118
Thus, Amount to be paid = $4118 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) = 8%
And, Time (t) = 2 years
Thus, Amount (A)
= $3550 + ($3550 × 8% × 2)
= $3550 + ($3550 ×8/100 × 2)
= $3550 + (3550 × 8 × 2/100)
= $3550 + (28400 × 2/100)
= $3550 + (56800/100)
= $3550 + $568 = $4118
Thus, Amount (A) to be paid = $4118 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 8%
This, means, $8 per $100 per year
∵ For $100, the simple interest for 1 year = $8
∴ For $1, the simple interest for 1 year = 8/100
∴ For $3550, the simple interest in 1 year
= 8/100 × 3550
= 8 × 3550/100
= 28400/100 = $284
Thus, simple interest for 1 year = $284
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $284 × 2 = $568
Thus, Simple Interest (SI) = $568
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $568
= $4118
Thus, Amount to be paid = $4118 Answer
Similar Questions
(1) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 4% simple interest.
(2) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 5% simple interest.
(3) What amount will be due after 2 years if Robert borrowed a sum of $3050 at a 7% simple interest?
(4) Find the amount to be paid if David borrowed a sum of $5400 at 6% simple interest for 8 years.
(5) In how much time a principal of $3150 will amount to $3780 at a simple interest of 5% per annum?
(6) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 9% simple interest for 7 years.
(7) Find the amount to be paid if William borrowed a sum of $5500 at 2% simple interest for 8 years.
(8) How much loan did Ashley borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7205 to clear it?
(9) Mark took a loan of $6800 at the rate of 6% simple interest per annum. If he paid an amount of $10064 to clear the loan, then find the time period of the loan.
(10) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 3% simple interest?