Question:
What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 10% simple interest?
Correct Answer
$4560
Solution And Explanation
Solution
Given,
Principal (P) = $3800
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) = $3800 × 10% × 2
= $3800 ×10/100 × 2
= 3800 × 10 × 2/100
= 38000 × 2/100
= 76000/100
= $760
Thus, Simple Interest = $760
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 = $3800 + $760
= $4560
Thus, Amount to be paid = $4560 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 = $3800
Rate of Simple Interest (SI) or (R) = 10%
And, Time (t) = 2 years
Thus, Amount (A)
= $3800 + ($3800 × 10% × 2)
= $3800 + ($3800 ×10/100 × 2)
= $3800 + (3800 × 10 × 2/100)
= $3800 + (38000 × 2/100)
= $3800 + (76000/100)
= $3800 + $760 = $4560
Thus, Amount (A) to be paid = $4560 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 $3800, the simple interest in 1 year
= 10/100 × 3800
= 10 × 3800/100
= 38000/100 = $380
Thus, simple interest for 1 year = $380
Therefore, simple interest for 2 years
= Simple interest for 1 year × 2
= $380 × 2 = $760
Thus, Simple Interest (SI) = $760
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3800 + $760
= $4560
Thus, Amount to be paid = $4560 Answer
Similar Questions
(1) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9288 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due after 10 years if Christopher borrowed a sum of $6000 at a rate of 9% simple interest.
(3) Find the amount to be paid if Robert borrowed a sum of $5100 at 6% simple interest for 8 years.
(4) Calculate the amount due if Richard borrowed a sum of $3600 at 10% simple interest for 3 years.
(5) Calculate the amount due if David borrowed a sum of $3400 at 8% simple interest for 3 years.
(6) Calculate the amount due if Jessica borrowed a sum of $3750 at 3% simple interest for 4 years.
(7) Calculate the amount due if Linda borrowed a sum of $3350 at 5% simple interest for 4 years.
(8) Calculate the amount due if John borrowed a sum of $3200 at 8% simple interest for 4 years.
(9) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 10% simple interest for 7 years.
(10) What amount will be due after 2 years if Andrew borrowed a sum of $3900 at a 9% simple interest?