Question:
What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 9% simple interest?
Correct Answer
$4248
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 9% × 2
= $3600 ×9/100 × 2
= 3600 × 9 × 2/100
= 32400 × 2/100
= 64800/100
= $648
Thus, Simple Interest = $648
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 = $3600 + $648
= $4248
Thus, Amount to be paid = $4248 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 = $3600
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3600 + ($3600 × 9% × 2)
= $3600 + ($3600 ×9/100 × 2)
= $3600 + (3600 × 9 × 2/100)
= $3600 + (32400 × 2/100)
= $3600 + (64800/100)
= $3600 + $648 = $4248
Thus, Amount (A) to be paid = $4248 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 $3600, the simple interest in 1 year
= 9/100 × 3600
= 9 × 3600/100
= 32400/100 = $324
Thus, simple interest for 1 year = $324
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $324 × 2 = $648
Thus, Simple Interest (SI) = $648
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $648
= $4248
Thus, Amount to be paid = $4248 Answer
Similar Questions
(1) What amount will be due after 2 years if Thomas borrowed a sum of $3400 at a 4% simple interest?
(2) Find the amount to be paid if Joseph borrowed a sum of $5700 at 9% simple interest for 7 years.
(3) If James borrowed $3000 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(4) Calculate the amount due if Karen borrowed a sum of $3950 at 7% simple interest for 3 years.
(5) If William paid $3780 to settle his loan which he had taken 4 years before at a simple interest of 2%, then find the loan taken.
(6) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 3% simple interest.
(7) Calculate the amount due if Joseph borrowed a sum of $3700 at 6% simple interest for 4 years.
(8) Find the amount to be paid if Richard borrowed a sum of $5600 at 7% simple interest for 8 years.
(9) How much loan did Lisa borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $6957.5 to clear it?
(10) Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 8 years.