Question:
Calculate the amount due if Jennifer borrowed a sum of $3250 at 5% simple interest for 3 years.
Correct Answer
$3737.5
Solution And Explanation
Solution
Given,
Principal (P) = $3250
Rate of Simple Interest (SI) = 5%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 5% simple interest means, Rate of Simple Interest (SI) is 5% 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) = $3250 × 5% × 3
= $3250 ×5/100 × 3
= 3250 × 5 × 3/100
= 16250 × 3/100
= 48750/100
= $487.5
Thus, Simple Interest = $487.5
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 = $3250 + $487.5
= $3737.5
Thus, Amount to be paid = $3737.5 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 = $3250
Rate of Simple Interest (SI) or (R) = 5%
And, Time (t) = 3 years
Thus, Amount (A)
= $3250 + ($3250 × 5% × 3)
= $3250 + ($3250 ×5/100 × 3)
= $3250 + (3250 × 5 × 3/100)
= $3250 + (16250 × 3/100)
= $3250 + (48750/100)
= $3250 + $487.5 = $3737.5
Thus, Amount (A) to be paid = $3737.5 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 5%
This, means, $5 per $100 per year
∵ For $100, the simple interest for 1 year = $5
∴ For $1, the simple interest for 1 year = 5/100
∴ For $3250, the simple interest in 1 year
= 5/100 × 3250
= 5 × 3250/100
= 16250/100 = $162.5
Thus, simple interest for 1 year = $162.5
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $162.5 × 3 = $487.5
Thus, Simple Interest (SI) = $487.5
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $487.5
= $3737.5
Thus, Amount to be paid = $3737.5 Answer
Similar Questions
(1) Find the amount to be paid if James borrowed a sum of $5000 at 10% simple interest for 7 years.
(2) How much loan did Jennifer borrow 5 years ago at a rate of simple interest 4% per annum, if he paid $6300 to clear it?
(3) Calculate the amount due if Linda borrowed a sum of $3350 at 4% simple interest for 4 years.
(4) Find the amount to be paid if Charles borrowed a sum of $5900 at 2% simple interest for 7 years.
(5) Calculate the amount due after 10 years if Karen borrowed a sum of $5950 at a rate of 10% simple interest.
(6) Find the amount to be paid if Linda borrowed a sum of $5350 at 2% simple interest for 7 years.
(7) How much loan did Cynthia borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8745 to clear it?
(8) How much loan did Ronald borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $8250 to clear it?
(9) In how much time a principal of $3100 will amount to $3348 at a simple interest of 4% per annum?
(10) Linda took a loan of $4700 at the rate of 9% simple interest per annum. If he paid an amount of $8930 to clear the loan, then find the time period of the loan.