Question:
Calculate the amount due if Barbara borrowed a sum of $3550 at 6% simple interest for 3 years.
Correct Answer
$4189
Solution And Explanation
Solution
Given,
Principal (P) = $3550
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) = $3550 × 6% × 3
= $3550 ×6/100 × 3
= 3550 × 6 × 3/100
= 21300 × 3/100
= 63900/100
= $639
Thus, Simple Interest = $639
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 = $3550 + $639
= $4189
Thus, Amount to be paid = $4189 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 = $3550
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3550 + ($3550 × 6% × 3)
= $3550 + ($3550 ×6/100 × 3)
= $3550 + (3550 × 6 × 3/100)
= $3550 + (21300 × 3/100)
= $3550 + (63900/100)
= $3550 + $639 = $4189
Thus, Amount (A) to be paid = $4189 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 $3550, the simple interest in 1 year
= 6/100 × 3550
= 6 × 3550/100
= 21300/100 = $213
Thus, simple interest for 1 year = $213
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $213 × 3 = $639
Thus, Simple Interest (SI) = $639
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3550 + $639
= $4189
Thus, Amount to be paid = $4189 Answer
Similar Questions
(1) Lisa had to pay $4536 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(2) John had to pay $3488 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(3) Nancy took a loan of $6300 at the rate of 9% simple interest per annum. If he paid an amount of $10836 to clear the loan, then find the time period of the loan.
(4) Charles took a loan of $5800 at the rate of 10% simple interest per annum. If he paid an amount of $9860 to clear the loan, then find the time period of the loan.
(5) David took a loan of $4800 at the rate of 6% simple interest per annum. If he paid an amount of $6528 to clear the loan, then find the time period of the loan.
(6) Find the amount to be paid if Sarah borrowed a sum of $5850 at 3% simple interest for 7 years.
(7) Find the amount to be paid if Robert borrowed a sum of $5100 at 7% simple interest for 8 years.
(8) What amount does Joseph have to pay after 6 years if he takes a loan of $3700 at 10% simple interest?
(9) Calculate the amount due after 9 years if Susan borrowed a sum of $5650 at a rate of 8% simple interest.
(10) What amount does Karen have to pay after 5 years if he takes a loan of $3950 at 9% simple interest?