Question:
What amount will be due after 2 years if Anthony borrowed a sum of $3650 at a 9% simple interest?
Correct Answer
$4307
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 9% × 2
= $3650 ×9/100 × 2
= 3650 × 9 × 2/100
= 32850 × 2/100
= 65700/100
= $657
Thus, Simple Interest = $657
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 = $3650 + $657
= $4307
Thus, Amount to be paid = $4307 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 = $3650
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3650 + ($3650 × 9% × 2)
= $3650 + ($3650 ×9/100 × 2)
= $3650 + (3650 × 9 × 2/100)
= $3650 + (32850 × 2/100)
= $3650 + (65700/100)
= $3650 + $657 = $4307
Thus, Amount (A) to be paid = $4307 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 $3650, the simple interest in 1 year
= 9/100 × 3650
= 9 × 3650/100
= 32850/100 = $328.5
Thus, simple interest for 1 year = $328.5
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $328.5 × 2 = $657
Thus, Simple Interest (SI) = $657
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $657
= $4307
Thus, Amount to be paid = $4307 Answer
Similar Questions
(1) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $8960 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 3% simple interest.
(3) David took a loan of $4800 at the rate of 9% simple interest per annum. If he paid an amount of $8256 to clear the loan, then find the time period of the loan.
(4) Find the amount to be paid if Patricia borrowed a sum of $5150 at 6% simple interest for 8 years.
(5) Charles had to pay $4368 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(6) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.
(7) What amount will be due after 2 years if David borrowed a sum of $3200 at a 4% simple interest?
(8) In how much time a principal of $3200 will amount to $3840 at a simple interest of 4% per annum?
(9) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $9120 to clear the loan, then find the time period of the loan.
(10) What amount does John have to pay after 6 years if he takes a loan of $3200 at 9% simple interest?