Question:
Calculate the amount due if Joseph borrowed a sum of $3700 at 3% simple interest for 3 years.
Correct Answer
$4033
Solution And Explanation
Solution
Given,
Principal (P) = $3700
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) = $3700 × 3% × 3
= $3700 ×3/100 × 3
= 3700 × 3 × 3/100
= 11100 × 3/100
= 33300/100
= $333
Thus, Simple Interest = $333
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 = $3700 + $333
= $4033
Thus, Amount to be paid = $4033 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 = $3700
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 3 years
Thus, Amount (A)
= $3700 + ($3700 × 3% × 3)
= $3700 + ($3700 ×3/100 × 3)
= $3700 + (3700 × 3 × 3/100)
= $3700 + (11100 × 3/100)
= $3700 + (33300/100)
= $3700 + $333 = $4033
Thus, Amount (A) to be paid = $4033 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 $3700, the simple interest in 1 year
= 3/100 × 3700
= 3 × 3700/100
= 11100/100 = $111
Thus, simple interest for 1 year = $111
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $111 × 3 = $333
Thus, Simple Interest (SI) = $333
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3700 + $333
= $4033
Thus, Amount to be paid = $4033 Answer
Similar Questions
(1) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 4% simple interest.
(2) Find the amount to be paid if Jennifer borrowed a sum of $5250 at 4% simple interest for 7 years.
(3) If Ashley paid $5096 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(4) If Barbara borrowed $3550 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(5) If Margaret paid $5046 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.
(6) Find the amount to be paid if Joseph borrowed a sum of $5700 at 4% simple interest for 7 years.
(7) Calculate the amount due after 10 years if Jennifer borrowed a sum of $5250 at a rate of 6% simple interest.
(8) Find the amount to be paid if Christopher borrowed a sum of $6000 at 4% simple interest for 7 years.
(9) What amount does Michael have to pay after 6 years if he takes a loan of $3300 at 9% simple interest?
(10) James had to pay $3270 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.