Question:
What amount will be due after 2 years if David borrowed a sum of $3200 at a 9% simple interest?
Correct Answer
$3776
Solution And Explanation
Solution
Given,
Principal (P) = $3200
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) = $3200 × 9% × 2
= $3200 ×9/100 × 2
= 3200 × 9 × 2/100
= 28800 × 2/100
= 57600/100
= $576
Thus, Simple Interest = $576
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 = $3200 + $576
= $3776
Thus, Amount to be paid = $3776 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 = $3200
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3200 + ($3200 × 9% × 2)
= $3200 + ($3200 ×9/100 × 2)
= $3200 + (3200 × 9 × 2/100)
= $3200 + (28800 × 2/100)
= $3200 + (57600/100)
= $3200 + $576 = $3776
Thus, Amount (A) to be paid = $3776 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 $3200, the simple interest in 1 year
= 9/100 × 3200
= 9 × 3200/100
= 28800/100 = $288
Thus, simple interest for 1 year = $288
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $288 × 2 = $576
Thus, Simple Interest (SI) = $576
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $576
= $3776
Thus, Amount to be paid = $3776 Answer
Similar Questions
(1) Michael had to pay $3597 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(2) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 6% simple interest?
(3) If Lisa paid $4860 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(4) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 6% simple interest?
(5) Steven had to pay $4876 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(6) Sarah took a loan of $5700 at the rate of 10% simple interest per annum. If he paid an amount of $10830 to clear the loan, then find the time period of the loan.
(7) Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $8892 to clear the loan, then find the time period of the loan.
(8) James took a loan of $4000 at the rate of 6% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.
(9) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 7% simple interest?
(10) Calculate the amount due if William borrowed a sum of $3500 at 3% simple interest for 4 years.