Question:
Calculate the amount due if Richard borrowed a sum of $3600 at 6% simple interest for 3 years.
Correct Answer
$4248
Solution And Explanation
Solution
Given,
Principal (P) = $3600
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) = $3600 × 6% × 3
= $3600 ×6/100 × 3
= 3600 × 6 × 3/100
= 21600 × 3/100
= 64800/100
= $648
Thus, Simple Interest = $648
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 = $3600 + $648
= $4248
Thus, Amount to be paid = $4248 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 = $3600
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3600 + ($3600 × 6% × 3)
= $3600 + ($3600 ×6/100 × 3)
= $3600 + (3600 × 6 × 3/100)
= $3600 + (21600 × 3/100)
= $3600 + (64800/100)
= $3600 + $648 = $4248
Thus, Amount (A) to be paid = $4248 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 $3600, the simple interest in 1 year
= 6/100 × 3600
= 6 × 3600/100
= 21600/100 = $216
Thus, simple interest for 1 year = $216
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $216 × 3 = $648
Thus, Simple Interest (SI) = $648
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3600 + $648
= $4248
Thus, Amount to be paid = $4248 Answer
Similar Questions
(1) Donald took a loan of $7000 at the rate of 7% simple interest per annum. If he paid an amount of $10920 to clear the loan, then find the time period of the loan.
(2) Steven had to pay $5014 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(3) Charles took a loan of $5800 at the rate of 9% simple interest per annum. If he paid an amount of $8932 to clear the loan, then find the time period of the loan.
(4) What amount will be due after 2 years if Joseph borrowed a sum of $3350 at a 8% simple interest?
(5) What amount does Mary have to pay after 5 years if he takes a loan of $3050 at 2% simple interest?
(6) What amount does Robert have to pay after 5 years if he takes a loan of $3100 at 4% simple interest?
(7) What amount does Karen have to pay after 6 years if he takes a loan of $3950 at 9% simple interest?
(8) Calculate the amount due after 9 years if Patricia borrowed a sum of $5150 at a rate of 8% simple interest.
(9) Michael took a loan of $4600 at the rate of 6% simple interest per annum. If he paid an amount of $6808 to clear the loan, then find the time period of the loan.
(10) If Betty paid $5100 to settle his loan which he had taken 4 years before at a simple interest of 5%, then find the loan taken.