Question:
What amount will be due after 2 years if James borrowed a sum of $3000 at a 9% simple interest?
Correct Answer
$3540
Solution And Explanation
Solution
Given,
Principal (P) = $3000
Rate of Simple Interest (SI) = 9%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 9% simple interest means, Rate of Simple Interest (SI) is 9% 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) = $3000 × 9% × 2
= $3000 ×9/100 × 2
= 3000 × 9 × 2/100
= 27000 × 2/100
= 54000/100
= $540
Thus, Simple Interest = $540
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 = $3000 + $540
= $3540
Thus, Amount to be paid = $3540 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 = $3000
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3000 + ($3000 × 9% × 2)
= $3000 + ($3000 ×9/100 × 2)
= $3000 + (3000 × 9 × 2/100)
= $3000 + (27000 × 2/100)
= $3000 + (54000/100)
= $3000 + $540 = $3540
Thus, Amount (A) to be paid = $3540 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 9%
This, means, $9 per $100 per year
∵ For $100, the simple interest for 1 year = $9
∴ For $1, the simple interest for 1 year = 9/100
∴ For $3000, the simple interest in 1 year
= 9/100 × 3000
= 9 × 3000/100
= 27000/100 = $270
Thus, simple interest for 1 year = $270
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $270 × 2 = $540
Thus, Simple Interest (SI) = $540
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3000 + $540
= $3540
Thus, Amount to be paid = $3540 Answer
Similar Questions
(1) Find the amount to be paid if David borrowed a sum of $5400 at 7% simple interest for 8 years.
(2) Calculate the amount due after 10 years if Robert borrowed a sum of $5100 at a rate of 4% simple interest.
(3) If James paid $3240 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(4) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $6846 to clear the loan, then find the time period of the loan.
(5) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $6400 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 10 years if Patricia borrowed a sum of $5150 at a rate of 9% simple interest.
(7) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 7% simple interest.
(8) Calculate the amount due if Thomas borrowed a sum of $3800 at 4% simple interest for 4 years.
(9) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 5% simple interest?
(10) If Andrew paid $5376 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.