Question:
Calculate the amount due if Charles borrowed a sum of $3900 at 3% simple interest for 3 years.
Correct Answer
$4251
Solution And Explanation
Solution
Given,
Principal (P) = $3900
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) = $3900 × 3% × 3
= $3900 ×3/100 × 3
= 3900 × 3 × 3/100
= 11700 × 3/100
= 35100/100
= $351
Thus, Simple Interest = $351
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 = $3900 + $351
= $4251
Thus, Amount to be paid = $4251 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 = $3900
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 3 years
Thus, Amount (A)
= $3900 + ($3900 × 3% × 3)
= $3900 + ($3900 ×3/100 × 3)
= $3900 + (3900 × 3 × 3/100)
= $3900 + (11700 × 3/100)
= $3900 + (35100/100)
= $3900 + $351 = $4251
Thus, Amount (A) to be paid = $4251 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 $3900, the simple interest in 1 year
= 3/100 × 3900
= 3 × 3900/100
= 11700/100 = $117
Thus, simple interest for 1 year = $117
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $117 × 3 = $351
Thus, Simple Interest (SI) = $351
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3900 + $351
= $4251
Thus, Amount to be paid = $4251 Answer
Similar Questions
(1) If Kenneth paid $5600 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(2) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 9% simple interest.
(3) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 5% simple interest?
(4) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 7% simple interest?
(5) Jessica took a loan of $5500 at the rate of 8% simple interest per annum. If he paid an amount of $9900 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Jessica borrowed a sum of $5750 at 4% simple interest for 8 years.
(7) What amount does John have to pay after 5 years if he takes a loan of $3200 at 8% simple interest?
(8) What amount does Joseph have to pay after 5 years if he takes a loan of $3700 at 10% simple interest?
(9) What amount will be due after 2 years if Richard borrowed a sum of $3300 at a 10% simple interest?
(10) Barbara took a loan of $5100 at the rate of 9% simple interest per annum. If he paid an amount of $9231 to clear the loan, then find the time period of the loan.