Question:
Calculate the amount due if David borrowed a sum of $3400 at 6% simple interest for 3 years.
Correct Answer
$4012
Solution And Explanation
Solution
Given,
Principal (P) = $3400
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) = $3400 × 6% × 3
= $3400 ×6/100 × 3
= 3400 × 6 × 3/100
= 20400 × 3/100
= 61200/100
= $612
Thus, Simple Interest = $612
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 = $3400 + $612
= $4012
Thus, Amount to be paid = $4012 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 = $3400
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3400 + ($3400 × 6% × 3)
= $3400 + ($3400 ×6/100 × 3)
= $3400 + (3400 × 6 × 3/100)
= $3400 + (20400 × 3/100)
= $3400 + (61200/100)
= $3400 + $612 = $4012
Thus, Amount (A) to be paid = $4012 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 $3400, the simple interest in 1 year
= 6/100 × 3400
= 6 × 3400/100
= 20400/100 = $204
Thus, simple interest for 1 year = $204
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $204 × 3 = $612
Thus, Simple Interest (SI) = $612
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3400 + $612
= $4012
Thus, Amount to be paid = $4012 Answer
Similar Questions
(1) Calculate the amount due if Jessica borrowed a sum of $3750 at 9% simple interest for 3 years.
(2) What amount does Linda have to pay after 6 years if he takes a loan of $3350 at 2% simple interest?
(3) Find the amount to be paid if Mary borrowed a sum of $5050 at 7% simple interest for 7 years.
(4) Calculate the amount due if Jennifer borrowed a sum of $3250 at 6% simple interest for 3 years.
(5) If David borrowed $3400 from a bank at a rate of 3% simple interest per annum then find the amount to be paid after 2 years.
(6) Calculate the amount due if Joseph borrowed a sum of $3700 at 9% simple interest for 3 years.
(7) Calculate the amount due after 9 years if Michael borrowed a sum of $5300 at a rate of 10% simple interest.
(8) How much loan did Kimberly borrow 5 years ago at a rate of simple interest 2% per annum, if he paid $7315 to clear it?
(9) Jennifer took a loan of $4500 at the rate of 10% simple interest per annum. If he paid an amount of $8100 to clear the loan, then find the time period of the loan.
(10) If Michael borrowed $3300 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.