Question:
What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 9% simple interest?
Correct Answer
$3894
Solution And Explanation
Solution
Given,
Principal (P) = $3300
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) = $3300 × 9% × 2
= $3300 ×9/100 × 2
= 3300 × 9 × 2/100
= 29700 × 2/100
= 59400/100
= $594
Thus, Simple Interest = $594
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 = $3300 + $594
= $3894
Thus, Amount to be paid = $3894 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 = $3300
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3300 + ($3300 × 9% × 2)
= $3300 + ($3300 ×9/100 × 2)
= $3300 + (3300 × 9 × 2/100)
= $3300 + (29700 × 2/100)
= $3300 + (59400/100)
= $3300 + $594 = $3894
Thus, Amount (A) to be paid = $3894 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 $3300, the simple interest in 1 year
= 9/100 × 3300
= 9 × 3300/100
= 29700/100 = $297
Thus, simple interest for 1 year = $297
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $297 × 2 = $594
Thus, Simple Interest (SI) = $594
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3300 + $594
= $3894
Thus, Amount to be paid = $3894 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 8% simple interest.
(2) Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 3 years.
(3) Find the amount to be paid if Barbara borrowed a sum of $5550 at 4% simple interest for 8 years.
(4) How much loan did Paul borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $8040 to clear it?
(5) What amount does Barbara have to pay after 5 years if he takes a loan of $3550 at 3% simple interest?
(6) Calculate the amount due if Barbara borrowed a sum of $3550 at 8% simple interest for 4 years.
(7) Calculate the amount due if Joseph borrowed a sum of $3700 at 6% simple interest for 3 years.
(8) David took a loan of $4800 at the rate of 8% simple interest per annum. If he paid an amount of $8256 to clear the loan, then find the time period of the loan.
(9) Find the amount to be paid if Jessica borrowed a sum of $5750 at 8% simple interest for 7 years.
(10) Calculate the amount due after 10 years if Richard borrowed a sum of $5600 at a rate of 3% simple interest.