Question:
Calculate the amount due if James borrowed a sum of $3000 at 6% simple interest for 3 years.
Correct Answer
$3540
Solution And Explanation
Solution
Given,
Principal (P) = $3000
Rate of Simple Interest (SI) = 6%
Time (t) = 3 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 6% simple interest means, Rate of Simple Interest (SI) is 6% 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 × 6% × 3
= $3000 ×6/100 × 3
= 3000 × 6 × 3/100
= 18000 × 3/100
= 54000/100
= $540
Thus, Simple Interest = $540
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 + $540
= $3540
Thus, Amount to be paid = $3540 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) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3000 + ($3000 × 6% × 3)
= $3000 + ($3000 ×6/100 × 3)
= $3000 + (3000 × 6 × 3/100)
= $3000 + (18000 × 3/100)
= $3000 + (54000/100)
= $3000 + $540 = $3540
Thus, Amount (A) to be paid = $3540 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 6%
This, means, $6 per $100 per year
∵ For $100, the simple interest for 1 year = $6
∴ For $1, the simple interest for 1 year = 6/100
∴ For $3000, the simple interest in 1 year
= 6/100 × 3000
= 6 × 3000/100
= 18000/100 = $180
Thus, simple interest for 1 year = $180
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $180 × 3 = $540
Thus, Simple Interest (SI) = $540
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3000 + $540
= $3540
Thus, Amount to be paid = $3540 Answer
Similar Questions
(1) If Linda borrowed $3350 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(2) Jennifer took a loan of $4500 at the rate of 7% simple interest per annum. If he paid an amount of $7650 to clear the loan, then find the time period of the loan.
(3) How much loan did Timothy borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9250 to clear it?
(4) If Patricia paid $3780 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.
(5) What amount does Elizabeth have to pay after 5 years if he takes a loan of $3450 at 8% simple interest?
(6) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 4% simple interest?
(7) Find the amount to be paid if Jessica borrowed a sum of $5750 at 6% simple interest for 7 years.
(8) Lisa took a loan of $6100 at the rate of 10% simple interest per annum. If he paid an amount of $11590 to clear the loan, then find the time period of the loan.
(9) Calculate the amount due if Michael borrowed a sum of $3300 at 10% simple interest for 3 years.
(10) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 3 years.