Question:
Calculate the amount due if Barbara borrowed a sum of $3550 at 2% simple interest for 3 years.
Correct Answer
$3763
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 2% × 3
= $3550 ×2/100 × 3
= 3550 × 2 × 3/100
= 7100 × 3/100
= 21300/100
= $213
Thus, Simple Interest = $213
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 + $213
= $3763
Thus, Amount to be paid = $3763 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) = 2%
And, Time (t) = 3 years
Thus, Amount (A)
= $3550 + ($3550 × 2% × 3)
= $3550 + ($3550 ×2/100 × 3)
= $3550 + (3550 × 2 × 3/100)
= $3550 + (7100 × 3/100)
= $3550 + (21300/100)
= $3550 + $213 = $3763
Thus, Amount (A) to be paid = $3763 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 $3550, the simple interest in 1 year
= 2/100 × 3550
= 2 × 3550/100
= 7100/100 = $71
Thus, simple interest for 1 year = $71
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $71 × 3 = $213
Thus, Simple Interest (SI) = $213
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $213
= $3763
Thus, Amount to be paid = $3763 Answer
Similar Questions
(1) Find the amount to be paid if Sarah borrowed a sum of $5850 at 10% simple interest for 8 years.
(2) Find the amount to be paid if Barbara borrowed a sum of $5550 at 2% simple interest for 7 years.
(3) Find the amount to be paid if John borrowed a sum of $5200 at 8% simple interest for 7 years.
(4) What amount does David have to pay after 5 years if he takes a loan of $3400 at 9% simple interest?
(5) What amount does Sarah have to pay after 5 years if he takes a loan of $3850 at 8% simple interest?
(6) Calculate the amount due after 10 years if Barbara borrowed a sum of $5550 at a rate of 8% simple interest.
(7) Find the amount to be paid if Barbara borrowed a sum of $5550 at 7% simple interest for 7 years.
(8) Find the amount to be paid if Linda borrowed a sum of $5350 at 4% simple interest for 8 years.
(9) Calculate the amount due after 9 years if Karen borrowed a sum of $5950 at a rate of 7% simple interest.
(10) Find the amount to be paid if Thomas borrowed a sum of $5800 at 3% simple interest for 8 years.