Question:
Calculate the amount due if Susan borrowed a sum of $3650 at 2% simple interest for 3 years.
Correct Answer
$3869
Solution And Explanation
Solution
Given,
Principal (P) = $3650
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) = $3650 × 2% × 3
= $3650 ×2/100 × 3
= 3650 × 2 × 3/100
= 7300 × 3/100
= 21900/100
= $219
Thus, Simple Interest = $219
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 = $3650 + $219
= $3869
Thus, Amount to be paid = $3869 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 = $3650
Rate of Simple Interest (SI) or (R) = 2%
And, Time (t) = 3 years
Thus, Amount (A)
= $3650 + ($3650 × 2% × 3)
= $3650 + ($3650 ×2/100 × 3)
= $3650 + (3650 × 2 × 3/100)
= $3650 + (7300 × 3/100)
= $3650 + (21900/100)
= $3650 + $219 = $3869
Thus, Amount (A) to be paid = $3869 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 $3650, the simple interest in 1 year
= 2/100 × 3650
= 2 × 3650/100
= 7300/100 = $73
Thus, simple interest for 1 year = $73
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $73 × 3 = $219
Thus, Simple Interest (SI) = $219
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3650 + $219
= $3869
Thus, Amount to be paid = $3869 Answer
Similar Questions
(1) Calculate the amount due if Barbara borrowed a sum of $3550 at 3% simple interest for 4 years.
(2) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 4% simple interest.
(3) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 10% simple interest for 7 years.
(4) What amount does William have to pay after 5 years if he takes a loan of $3500 at 3% simple interest?
(5) Thomas took a loan of $5600 at the rate of 8% simple interest per annum. If he paid an amount of $9632 to clear the loan, then find the time period of the loan.
(6) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 6% simple interest?
(7) Find the amount to be paid if Charles borrowed a sum of $5900 at 3% simple interest for 8 years.
(8) Emily had to pay $5320 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(9) Calculate the amount due if James borrowed a sum of $3000 at 5% simple interest for 3 years.
(10) David took a loan of $4800 at the rate of 10% simple interest per annum. If he paid an amount of $8640 to clear the loan, then find the time period of the loan.