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 does Michael have to pay after 5 years if he takes a loan of $3300 at 8% simple interest?
(2) Margaret took a loan of $6700 at the rate of 6% simple interest per annum. If he paid an amount of $9916 to clear the loan, then find the time period of the loan.
(3) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 4% simple interest.
(4) Mary had to pay $3324.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(5) Donald took a loan of $7000 at the rate of 9% simple interest per annum. If he paid an amount of $12670 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due after 10 years if Jessica borrowed a sum of $5750 at a rate of 5% simple interest.
(7) Anthony took a loan of $6600 at the rate of 7% simple interest per annum. If he paid an amount of $10296 to clear the loan, then find the time period of the loan.
(8) Robert took a loan of $4200 at the rate of 9% simple interest per annum. If he paid an amount of $7602 to clear the loan, then find the time period of the loan.
(9) What amount does Mary have to pay after 6 years if he takes a loan of $3050 at 8% simple interest?
(10) Calculate the amount due if Thomas borrowed a sum of $3800 at 9% simple interest for 4 years.