Question:
What amount will be due after 2 years if Daniel borrowed a sum of $3550 at a 10% simple interest?
Correct Answer
$4260
Solution And Explanation
Solution
Given,
Principal (P) = $3550
Rate of Simple Interest (SI) = 10%
Time (t) = 2 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 10% simple interest means, Rate of Simple Interest (SI) is 10% 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) = $3550 × 10% × 2
= $3550 ×10/100 × 2
= 3550 × 10 × 2/100
= 35500 × 2/100
= 71000/100
= $710
Thus, Simple Interest = $710
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 = $3550 + $710
= $4260
Thus, Amount to be paid = $4260 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 = $3550
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 2 years
Thus, Amount (A)
= $3550 + ($3550 × 10% × 2)
= $3550 + ($3550 ×10/100 × 2)
= $3550 + (3550 × 10 × 2/100)
= $3550 + (35500 × 2/100)
= $3550 + (71000/100)
= $3550 + $710 = $4260
Thus, Amount (A) to be paid = $4260 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 10%
This, means, $10 per $100 per year
∵ For $100, the simple interest for 1 year = $10
∴ For $1, the simple interest for 1 year = 10/100
∴ For $3550, the simple interest in 1 year
= 10/100 × 3550
= 10 × 3550/100
= 35500/100 = $355
Thus, simple interest for 1 year = $355
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $355 × 2 = $710
Thus, Simple Interest (SI) = $710
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $710
= $4260
Thus, Amount to be paid = $4260 Answer
Similar Questions
(1) If Anthony paid $5160 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(2) Calculate the amount due if Sarah borrowed a sum of $3850 at 10% simple interest for 4 years.
(3) Calculate the amount due if Barbara borrowed a sum of $3550 at 7% simple interest for 3 years.
(4) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 4% simple interest.
(5) Calculate the amount due after 9 years if Sarah borrowed a sum of $5850 at a rate of 3% simple interest.
(6) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $7987 to clear the loan, then find the time period of the loan.
(7) How much loan did Michelle borrow 5 years ago at a rate of simple interest 3% per annum, if he paid $7992.5 to clear it?
(8) In how much time a principal of $3050 will amount to $3507.5 at a simple interest of 5% per annum?
(9) If James paid $3600 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) What amount does Susan have to pay after 6 years if he takes a loan of $3650 at 3% simple interest?