Question:
What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 9% simple interest?
Correct Answer
$4602
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 9% × 2
= $3900 ×9/100 × 2
= 3900 × 9 × 2/100
= 35100 × 2/100
= 70200/100
= $702
Thus, Simple Interest = $702
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 = $3900 + $702
= $4602
Thus, Amount to be paid = $4602 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 = $3900
Rate of Simple Interest (SI) or (R) = 9%
And, Time (t) = 2 years
Thus, Amount (A)
= $3900 + ($3900 × 9% × 2)
= $3900 + ($3900 ×9/100 × 2)
= $3900 + (3900 × 9 × 2/100)
= $3900 + (35100 × 2/100)
= $3900 + (70200/100)
= $3900 + $702 = $4602
Thus, Amount (A) to be paid = $4602 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 $3900, the simple interest in 1 year
= 9/100 × 3900
= 9 × 3900/100
= 35100/100 = $351
Thus, simple interest for 1 year = $351
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $351 × 2 = $702
Thus, Simple Interest (SI) = $702
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $702
= $4602
Thus, Amount to be paid = $4602 Answer
Similar Questions
(1) Sarah took a loan of $5700 at the rate of 8% simple interest per annum. If he paid an amount of $8436 to clear the loan, then find the time period of the loan.
(2) Find the amount to be paid if Christopher borrowed a sum of $6000 at 8% simple interest for 7 years.
(3) Anthony took a loan of $6600 at the rate of 10% simple interest per annum. If he paid an amount of $12540 to clear the loan, then find the time period of the loan.
(4) Ashley had to pay $4959.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(5) Calculate the amount due after 9 years if Thomas borrowed a sum of $5800 at a rate of 5% simple interest.
(6) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 7% simple interest?
(7) If Matthew paid $4704 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(8) Find the amount to be paid if Joseph borrowed a sum of $5700 at 6% simple interest for 8 years.
(9) Find the amount to be paid if Patricia borrowed a sum of $5150 at 4% simple interest for 7 years.
(10) Find the amount to be paid if Linda borrowed a sum of $5350 at 8% simple interest for 8 years.