Question:
Calculate the amount due if Joseph borrowed a sum of $3700 at 6% simple interest for 3 years.
Correct Answer
$4366
Solution And Explanation
Solution
Given,
Principal (P) = $3700
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) = $3700 × 6% × 3
= $3700 ×6/100 × 3
= 3700 × 6 × 3/100
= 22200 × 3/100
= 66600/100
= $666
Thus, Simple Interest = $666
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 = $3700 + $666
= $4366
Thus, Amount to be paid = $4366 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 = $3700
Rate of Simple Interest (SI) or (R) = 6%
And, Time (t) = 3 years
Thus, Amount (A)
= $3700 + ($3700 × 6% × 3)
= $3700 + ($3700 ×6/100 × 3)
= $3700 + (3700 × 6 × 3/100)
= $3700 + (22200 × 3/100)
= $3700 + (66600/100)
= $3700 + $666 = $4366
Thus, Amount (A) to be paid = $4366 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 $3700, the simple interest in 1 year
= 6/100 × 3700
= 6 × 3700/100
= 22200/100 = $222
Thus, simple interest for 1 year = $222
Therefore, simple interest for 3 years
= Simple interest for 1 year × 3
= $222 × 3 = $666
Thus, Simple Interest (SI) = $666
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $3700 + $666
= $4366
Thus, Amount to be paid = $4366 Answer
Similar Questions
(1) What amount does Patricia have to pay after 6 years if he takes a loan of $3150 at 5% simple interest?
(2) Calculate the amount due if Elizabeth borrowed a sum of $3450 at 5% simple interest for 4 years.
(3) Calculate the amount due if Susan borrowed a sum of $3650 at 6% simple interest for 3 years.
(4) Calculate the amount due if Karen borrowed a sum of $3950 at 7% simple interest for 4 years.
(5) Richard took a loan of $5200 at the rate of 7% simple interest per annum. If he paid an amount of $8840 to clear the loan, then find the time period of the loan.
(6) 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.
(7) Find the amount to be paid if Mary borrowed a sum of $5050 at 6% simple interest for 7 years.
(8) Calculate the amount due if William borrowed a sum of $3500 at 6% simple interest for 4 years.
(9) John took a loan of $4400 at the rate of 6% simple interest per annum. If he paid an amount of $7040 to clear the loan, then find the time period of the loan.
(10) Calculate the amount due if Jennifer borrowed a sum of $3250 at 7% simple interest for 4 years.