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) Sandra took a loan of $6900 at the rate of 8% simple interest per annum. If he paid an amount of $10764 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 9 years if Mary borrowed a sum of $5050 at a rate of 2% simple interest.
(3) What amount does Susan have to pay after 5 years if he takes a loan of $3650 at 8% simple interest?
(4) Mark took a loan of $6800 at the rate of 9% simple interest per annum. If he paid an amount of $12308 to clear the loan, then find the time period of the loan.
(5) Find the amount to be paid if Mary borrowed a sum of $5050 at 9% simple interest for 7 years.
(6) Margaret took a loan of $6700 at the rate of 6% simple interest per annum. If he paid an amount of $9514 to clear the loan, then find the time period of the loan.
(7) How much loan did Ryan borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8690 to clear it?
(8) William took a loan of $5000 at the rate of 6% simple interest per annum. If he paid an amount of $6800 to clear the loan, then find the time period of the loan.
(9) Christopher took a loan of $6000 at the rate of 7% simple interest per annum. If he paid an amount of $10200 to clear the loan, then find the time period of the loan.
(10) What amount will be due after 2 years if Christopher borrowed a sum of $3500 at a 7% simple interest?