Question:
Calculate the amount due if John borrowed a sum of $3200 at 3% simple interest for 3 years.
Correct Answer
$3488
Solution And Explanation
Solution
Given,
Principal (P) = $3200
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) = $3200 × 3% × 3
= $3200 ×3/100 × 3
= 3200 × 3 × 3/100
= 9600 × 3/100
= 28800/100
= $288
Thus, Simple Interest = $288
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 = $3200 + $288
= $3488
Thus, Amount to be paid = $3488 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 = $3200
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 3 years
Thus, Amount (A)
= $3200 + ($3200 × 3% × 3)
= $3200 + ($3200 ×3/100 × 3)
= $3200 + (3200 × 3 × 3/100)
= $3200 + (9600 × 3/100)
= $3200 + (28800/100)
= $3200 + $288 = $3488
Thus, Amount (A) to be paid = $3488 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 $3200, the simple interest in 1 year
= 3/100 × 3200
= 3 × 3200/100
= 9600/100 = $96
Thus, simple interest for 1 year = $96
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $96 × 3 = $288
Thus, Simple Interest (SI) = $288
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3200 + $288
= $3488
Thus, Amount to be paid = $3488 Answer
Similar Questions
(1) Find the amount to be paid if Charles borrowed a sum of $5900 at 9% simple interest for 8 years.
(2) Thomas took a loan of $5600 at the rate of 6% simple interest per annum. If he paid an amount of $8960 to clear the loan, then find the time period of the loan.
(3) If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(4) Michelle had to pay $5247 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(5) William took a loan of $5000 at the rate of 9% simple interest per annum. If he paid an amount of $8150 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if Linda borrowed a sum of $3350 at 6% simple interest for 4 years.
(7) Find the amount to be paid if David borrowed a sum of $5400 at 6% simple interest for 8 years.
(8) If James borrowed $3000 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(9) Calculate the amount due if Barbara borrowed a sum of $3550 at 4% simple interest for 4 years.
(10) Nancy took a loan of $6300 at the rate of 10% simple interest per annum. If he paid an amount of $11970 to clear the loan, then find the time period of the loan.