Question:
What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 9% simple interest?
Correct Answer
$3717
Solution And Explanation
Solution
Given,
Principal (P) = $3150
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) = $3150 × 9% × 2
= $3150 ×9/100 × 2
= 3150 × 9 × 2/100
= 28350 × 2/100
= 56700/100
= $567
Thus, Simple Interest = $567
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 = $3150 + $567
= $3717
Thus, Amount to be paid = $3717 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 = $3150
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3150 + ($3150 × 9% × 2)
= $3150 + ($3150 ×9/100 × 2)
= $3150 + (3150 × 9 × 2/100)
= $3150 + (28350 × 2/100)
= $3150 + (56700/100)
= $3150 + $567 = $3717
Thus, Amount (A) to be paid = $3717 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 $3150, the simple interest in 1 year
= 9/100 × 3150
= 9 × 3150/100
= 28350/100 = $283.5
Thus, simple interest for 1 year = $283.5
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $283.5 × 2 = $567
Thus, Simple Interest (SI) = $567
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3150 + $567
= $3717
Thus, Amount to be paid = $3717 Answer
Similar Questions
(1) Find the amount to be paid if Thomas borrowed a sum of $5800 at 4% simple interest for 8 years.
(2) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 6% simple interest?
(3) Karen took a loan of $5900 at the rate of 9% simple interest per annum. If he paid an amount of $10148 to clear the loan, then find the time period of the loan.
(4) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $9324 to clear the loan, then find the time period of the loan.
(5) James took a loan of $4000 at the rate of 9% simple interest per annum. If he paid an amount of $6160 to clear the loan, then find the time period of the loan.
(6) What amount will be due after 2 years if Michael borrowed a sum of $3150 at a 9% simple interest?
(7) Find the amount to be paid if Thomas borrowed a sum of $5800 at 6% simple interest for 7 years.
(8) David took a loan of $4800 at the rate of 6% simple interest per annum. If he paid an amount of $7104 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Thomas borrowed a sum of $5800 at 7% simple interest for 8 years.
(10) Joseph took a loan of $5400 at the rate of 7% simple interest per annum. If he paid an amount of $8046 to clear the loan, then find the time period of the loan.