Question:
Calculate the amount due if Jennifer borrowed a sum of $3250 at 6% simple interest for 3 years.
Correct Answer
$3835
Solution And Explanation
Solution
Given,
Principal (P) = $3250
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) = $3250 × 6% × 3
= $3250 ×6/100 × 3
= 3250 × 6 × 3/100
= 19500 × 3/100
= 58500/100
= $585
Thus, Simple Interest = $585
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 + $585
= $3835
Thus, Amount to be paid = $3835 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) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3250 + ($3250 × 6% × 3)
= $3250 + ($3250 ×6/100 × 3)
= $3250 + (3250 × 6 × 3/100)
= $3250 + (19500 × 3/100)
= $3250 + (58500/100)
= $3250 + $585 = $3835
Thus, Amount (A) to be paid = $3835 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 $3250, the simple interest in 1 year
= 6/100 × 3250
= 6 × 3250/100
= 19500/100 = $195
Thus, simple interest for 1 year = $195
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $195 × 3 = $585
Thus, Simple Interest (SI) = $585
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3250 + $585
= $3835
Thus, Amount to be paid = $3835 Answer
Similar Questions
(1) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 4 years.
(2) How much loan did Brian borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $9000 to clear it?
(3) Find the amount to be paid if Richard borrowed a sum of $5600 at 4% simple interest for 7 years.
(4) Calculate the amount due after 10 years if Linda borrowed a sum of $5350 at a rate of 7% simple interest.
(5) What amount does Jennifer have to pay after 6 years if he takes a loan of $3250 at 3% simple interest?
(6) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 5% simple interest?
(7) What amount does David have to pay after 5 years if he takes a loan of $3400 at 3% simple interest?
(8) How much loan did Michael borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $5830 to clear it?
(9) If Anthony paid $4816 to settle his loan which he had taken 4 years before at a simple interest of 3%, then find the loan taken.
(10) How much loan did Michael borrow 5 years ago at a rate of simple interest 5% per annum, if he paid $6625 to clear it?