Question:
Calculate the amount due if Robert borrowed a sum of $3100 at 2% simple interest for 3 years.
Correct Answer
$3286
Solution And Explanation
Solution
Given,
Principal (P) = $3100
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) = $3100 × 2% × 3
= $3100 ×2/100 × 3
= 3100 × 2 × 3/100
= 6200 × 3/100
= 18600/100
= $186
Thus, Simple Interest = $186
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 = $3100 + $186
= $3286
Thus, Amount to be paid = $3286 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 = $3100
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 3 years
Thus, Amount (A)
= $3100 + ($3100 × 2% × 3)
= $3100 + ($3100 ×2/100 × 3)
= $3100 + (3100 × 2 × 3/100)
= $3100 + (6200 × 3/100)
= $3100 + (18600/100)
= $3100 + $186 = $3286
Thus, Amount (A) to be paid = $3286 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 $3100, the simple interest in 1 year
= 2/100 × 3100
= 2 × 3100/100
= 6200/100 = $62
Thus, simple interest for 1 year = $62
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $62 × 3 = $186
Thus, Simple Interest (SI) = $186
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3100 + $186
= $3286
Thus, Amount to be paid = $3286 Answer
Similar Questions
(1) Find the amount to be paid if Karen borrowed a sum of $5950 at 2% simple interest for 7 years.
(2) 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.
(3) What amount will be due after 2 years if Steven borrowed a sum of $3800 at a 7% simple interest?
(4) Calculate the amount due if Jessica borrowed a sum of $3750 at 5% simple interest for 4 years.
(5) Mary took a loan of $4100 at the rate of 8% simple interest per annum. If he paid an amount of $6396 to clear the loan, then find the time period of the loan.
(6) In how much time a principal of $3200 will amount to $3392 at a simple interest of 2% per annum?
(7) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 7% simple interest?
(8) What amount does David have to pay after 6 years if he takes a loan of $3400 at 10% simple interest?
(9) If Patricia paid $3780 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(10) Elizabeth took a loan of $4900 at the rate of 10% simple interest per annum. If he paid an amount of $7840 to clear the loan, then find the time period of the loan.