Question:
What amount will be due after 2 years if Matthew borrowed a sum of $3600 at a 10% simple interest?
Correct Answer
$4320
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 10% × 2
= $3600 ×10/100 × 2
= 3600 × 10 × 2/100
= 36000 × 2/100
= 72000/100
= $720
Thus, Simple Interest = $720
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 = $3600 + $720
= $4320
Thus, Amount to be paid = $4320 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 = $3600
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 2 years
Thus, Amount (A)
= $3600 + ($3600 × 10% × 2)
= $3600 + ($3600 ×10/100 × 2)
= $3600 + (3600 × 10 × 2/100)
= $3600 + (36000 × 2/100)
= $3600 + (72000/100)
= $3600 + $720 = $4320
Thus, Amount (A) to be paid = $4320 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 $3600, the simple interest in 1 year
= 10/100 × 3600
= 10 × 3600/100
= 36000/100 = $360
Thus, simple interest for 1 year = $360
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $360 × 2 = $720
Thus, Simple Interest (SI) = $720
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $720
= $4320
Thus, Amount to be paid = $4320 Answer
Similar Questions
(1) If Jennifer paid $3770 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(2) Daniel took a loan of $6200 at the rate of 10% simple interest per annum. If he paid an amount of $11160 to clear the loan, then find the time period of the loan.
(3) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $6808 to clear the loan, then find the time period of the loan.
(4) What amount does Charles have to pay after 6 years if he takes a loan of $3900 at 8% simple interest?
(5) Calculate the amount due if Patricia borrowed a sum of $3150 at 7% simple interest for 3 years.
(6) Calculate the amount due after 9 years if Barbara borrowed a sum of $5550 at a rate of 3% simple interest.
(7) Michelle had to pay $5395.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(8) Calculate the amount due if Linda borrowed a sum of $3350 at 9% simple interest for 4 years.
(9) James took a loan of $4000 at the rate of 8% simple interest per annum. If he paid an amount of $5920 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if James borrowed a sum of $3000 at 10% simple interest for 4 years.