Question:
Calculate the amount due if Mary borrowed a sum of $3050 at 2% simple interest for 3 years.
Correct Answer
$3233
Solution And Explanation
Solution
Given,
Principal (P) = $3050
Rate of Simple Interest (SI) = 2%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 2% simple interest means, Rate of Simple Interest (SI) is 2% 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) = $3050 × 2% × 3
= $3050 ×2/100 × 3
= 3050 × 2 × 3/100
= 6100 × 3/100
= 18300/100
= $183
Thus, Simple Interest = $183
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 = $3050 + $183
= $3233
Thus, Amount to be paid = $3233 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 = $3050
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 3 years
Thus, Amount (A)
= $3050 + ($3050 × 2% × 3)
= $3050 + ($3050 ×2/100 × 3)
= $3050 + (3050 × 2 × 3/100)
= $3050 + (6100 × 3/100)
= $3050 + (18300/100)
= $3050 + $183 = $3233
Thus, Amount (A) to be paid = $3233 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 2%
This, means, $2 per $100 per year
∵ For $100, the simple interest for 1 year = $2
∴ For $1, the simple interest for 1 year = 2/100
∴ For $3050, the simple interest in 1 year
= 2/100 × 3050
= 2 × 3050/100
= 6100/100 = $61
Thus, simple interest for 1 year = $61
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $61 × 3 = $183
Thus, Simple Interest (SI) = $183
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3050 + $183
= $3233
Thus, Amount to be paid = $3233 Answer
Similar Questions
(1) In how much time a principal of $3150 will amount to $3465 at a simple interest of 5% per annum?
(2) What amount does Michael have to pay after 5 years if he takes a loan of $3300 at 9% simple interest?
(3) Betty took a loan of $6500 at the rate of 8% simple interest per annum. If he paid an amount of $11700 to clear the loan, then find the time period of the loan.
(4) Calculate the amount due after 10 years if William borrowed a sum of $5500 at a rate of 8% simple interest.
(5) Calculate the amount due after 10 years if Joseph borrowed a sum of $5700 at a rate of 5% simple interest.
(6) What amount does John have to pay after 6 years if he takes a loan of $3200 at 6% simple interest?
(7) If Emily paid $5320 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(8) In how much time a principal of $3050 will amount to $3660 at a simple interest of 4% per annum?
(9) What amount does Robert have to pay after 6 years if he takes a loan of $3100 at 10% simple interest?
(10) What amount does William have to pay after 6 years if he takes a loan of $3500 at 3% simple interest?