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) John took a loan of $4400 at the rate of 10% simple interest per annum. If he paid an amount of $7920 to clear the loan, then find the time period of the loan.
(2) Betty took a loan of $6500 at the rate of 6% simple interest per annum. If he paid an amount of $8840 to clear the loan, then find the time period of the loan.
(3) What amount does William have to pay after 6 years if he takes a loan of $3500 at 3% simple interest?
(4) Susan took a loan of $5300 at the rate of 10% simple interest per annum. If he paid an amount of $9010 to clear the loan, then find the time period of the loan.
(5) Anthony took a loan of $6600 at the rate of 6% simple interest per annum. If he paid an amount of $10560 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 10 years if Michael borrowed a sum of $5300 at a rate of 7% simple interest.
(7) Find the amount to be paid if Christopher borrowed a sum of $6000 at 8% simple interest for 8 years.
(8) Calculate the amount due if William borrowed a sum of $3500 at 4% simple interest for 4 years.
(9) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $11900 to clear the loan, then find the time period of the loan.
(10) Joseph had to pay $4033 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.