Question:
Calculate the amount due if James borrowed a sum of $3000 at 3% simple interest for 3 years.
Correct Answer
$3270
Solution And Explanation
Solution
Given,
Principal (P) = $3000
Rate of Simple Interest (SI) = 3%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% 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) = $3000 × 3% × 3
= $3000 ×3/100 × 3
= 3000 × 3 × 3/100
= 9000 × 3/100
= 27000/100
= $270
Thus, Simple Interest = $270
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 = $3000 + $270
= $3270
Thus, Amount to be paid = $3270 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 = $3000
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 3 years
Thus, Amount (A)
= $3000 + ($3000 × 3% × 3)
= $3000 + ($3000 ×3/100 × 3)
= $3000 + (3000 × 3 × 3/100)
= $3000 + (9000 × 3/100)
= $3000 + (27000/100)
= $3000 + $270 = $3270
Thus, Amount (A) to be paid = $3270 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $3000, the simple interest in 1 year
= 3/100 × 3000
= 3 × 3000/100
= 9000/100 = $90
Thus, simple interest for 1 year = $90
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $90 × 3 = $270
Thus, Simple Interest (SI) = $270
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3000 + $270
= $3270
Thus, Amount to be paid = $3270 Answer
Similar Questions
(1) Find the amount to be paid if Karen borrowed a sum of $5950 at 6% simple interest for 7 years.
(2) Donald took a loan of $7000 at the rate of 10% simple interest per annum. If he paid an amount of $13300 to clear the loan, then find the time period of the loan.
(3) Andrew had to pay $5232 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(4) What amount will be due after 2 years if James borrowed a sum of $3000 at a 5% simple interest?
(5) Calculate the amount due if Karen borrowed a sum of $3950 at 10% simple interest for 3 years.
(6) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 9% simple interest.
(7) Find the amount to be paid if John borrowed a sum of $5200 at 9% simple interest for 7 years.
(8) What amount does Jennifer have to pay after 5 years if he takes a loan of $3250 at 2% simple interest?
(9) What amount does Christopher have to pay after 5 years if he takes a loan of $4000 at 5% simple interest?
(10) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6556 to clear the loan, then find the time period of the loan.