Question:
What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 9% simple interest?
Correct Answer
$4189
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 9% × 2
= $3550 ×9/100 × 2
= 3550 × 9 × 2/100
= 31950 × 2/100
= 63900/100
= $639
Thus, Simple Interest = $639
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 = $3550 + $639
= $4189
Thus, Amount to be paid = $4189 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 = $3550
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3550 + ($3550 × 9% × 2)
= $3550 + ($3550 ×9/100 × 2)
= $3550 + (3550 × 9 × 2/100)
= $3550 + (31950 × 2/100)
= $3550 + (63900/100)
= $3550 + $639 = $4189
Thus, Amount (A) to be paid = $4189 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 $3550, the simple interest in 1 year
= 9/100 × 3550
= 9 × 3550/100
= 31950/100 = $319.5
Thus, simple interest for 1 year = $319.5
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $319.5 × 2 = $639
Thus, Simple Interest (SI) = $639
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $639
= $4189
Thus, Amount to be paid = $4189 Answer
Similar Questions
(1) Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 7 years.
(2) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 6% simple interest?
(3) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 7% simple interest?
(4) Nancy took a loan of $6300 at the rate of 6% simple interest per annum. If he paid an amount of $8568 to clear the loan, then find the time period of the loan.
(5) In how much time a principal of $3200 will amount to $3584 at a simple interest of 3% per annum?
(6) Calculate the amount due after 9 years if Richard borrowed a sum of $5600 at a rate of 5% simple interest.
(7) If Michael paid $3696 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(8) Susan took a loan of $5300 at the rate of 7% simple interest per annum. If he paid an amount of $7897 to clear the loan, then find the time period of the loan.
(9) Michael took a loan of $4600 at the rate of 10% simple interest per annum. If he paid an amount of $8740 to clear the loan, then find the time period of the loan.
(10) If Matthew paid $4536 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.