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) Mark took a loan of $6800 at the rate of 10% simple interest per annum. If he paid an amount of $12920 to clear the loan, then find the time period of the loan.
(2) Calculate the amount due if Mary borrowed a sum of $3050 at 6% simple interest for 3 years.
(3) Elizabeth took a loan of $4900 at the rate of 9% simple interest per annum. If he paid an amount of $8428 to clear the loan, then find the time period of the loan.
(4) John took a loan of $4400 at the rate of 7% simple interest per annum. If he paid an amount of $6864 to clear the loan, then find the time period of the loan.
(5) Christopher had to pay $4360 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(6) What amount does Elizabeth have to pay after 6 years if he takes a loan of $3450 at 9% simple interest?
(7) Kenneth had to pay $5600 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(8) Elizabeth had to pay $3864 in order to furnish the loan taken 3 years before. If the rate of simple interest was 4% then find the sum borrowed.
(9) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 7 years.
(10) Christopher took a loan of $6000 at the rate of 9% simple interest per annum. If he paid an amount of $11400 to clear the loan, then find the time period of the loan.