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) Calculate the amount due if Susan borrowed a sum of $3650 at 9% simple interest for 3 years.
(2) What amount will be due after 2 years if William borrowed a sum of $3250 at a 6% simple interest?
(3) Richard took a loan of $5200 at the rate of 10% simple interest per annum. If he paid an amount of $9880 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 4% simple interest for 7 years.
(5) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $9310 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Joseph borrowed a sum of $5700 at 8% simple interest for 8 years.
(7) Christopher took a loan of $6000 at the rate of 7% simple interest per annum. If he paid an amount of $10200 to clear the loan, then find the time period of the loan.
(8) Michael had to pay $3795 in order to furnish the loan taken 3 years before. If the rate of simple interest was 5% then find the sum borrowed.
(9) Robert took a loan of $4200 at the rate of 7% simple interest per annum. If he paid an amount of $6552 to clear the loan, then find the time period of the loan.
(10) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $8580 to clear the loan, then find the time period of the loan.