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) How much loan did Margaret borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $7937.5 to clear it?
(2) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $8140 to clear the loan, then find the time period of the loan.
(3) Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $10660 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due if Jennifer borrowed a sum of $3250 at 3% simple interest for 3 years.
(5) In how much time a principal of $3150 will amount to $3339 at a simple interest of 3% per annum?
(6) What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 6% simple interest?
(7) Calculate the amount due if Thomas borrowed a sum of $3800 at 5% simple interest for 3 years.
(8) Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 3 years.
(9) What amount will be due after 2 years if William borrowed a sum of $3250 at a 6% simple interest?
(10) How much loan did Charles borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $6490 to clear it?