Question:
What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 9% simple interest?
Correct Answer
$4012
Solution And Explanation
Solution
Given,
Principal (P) = $3400
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) = $3400 × 9% × 2
= $3400 ×9/100 × 2
= 3400 × 9 × 2/100
= 30600 × 2/100
= 61200/100
= $612
Thus, Simple Interest = $612
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 = $3400 + $612
= $4012
Thus, Amount to be paid = $4012 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 = $3400
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3400 + ($3400 × 9% × 2)
= $3400 + ($3400 ×9/100 × 2)
= $3400 + (3400 × 9 × 2/100)
= $3400 + (30600 × 2/100)
= $3400 + (61200/100)
= $3400 + $612 = $4012
Thus, Amount (A) to be paid = $4012 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 $3400, the simple interest in 1 year
= 9/100 × 3400
= 9 × 3400/100
= 30600/100 = $306
Thus, simple interest for 1 year = $306
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $306 × 2 = $612
Thus, Simple Interest (SI) = $612
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3400 + $612
= $4012
Thus, Amount to be paid = $4012 Answer
Similar Questions
(1) Richard took a loan of $5200 at the rate of 9% simple interest per annum. If he paid an amount of $8944 to clear the loan, then find the time period of the loan.
(2) How much loan did Richard borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6720 to clear it?
(3) Calculate the amount due if Linda borrowed a sum of $3350 at 6% simple interest for 4 years.
(4) How much loan did Matthew borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $7440 to clear it?
(5) Karen took a loan of $5900 at the rate of 7% simple interest per annum. If he paid an amount of $9204 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Joseph borrowed a sum of $3700 at 8% simple interest for 3 years.
(7) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 7% simple interest?
(8) Mary took a loan of $4100 at the rate of 6% simple interest per annum. If he paid an amount of $5576 to clear the loan, then find the time period of the loan.
(9) How much loan did Emily borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7762.5 to clear it?
(10) Anthony took a loan of $6600 at the rate of 9% simple interest per annum. If he paid an amount of $10758 to clear the loan, then find the time period of the loan.